Exercise 12-13 (Algo) Understanding CVP relationships LO 12-7, 12-9Calculate the missing amounts for each of the following firms:Note: Do not round intermediate calculations.Firm AFirm BFirm CFirm DSales$ 322,000129,000Variable Contribution MarginCostsRatio465,00058,00034 %%29 %24 %Fixed Costs117,00035,200OperatingIncome (Loss)$35,02971,734(4,970)

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Answered: Exercise 12-13 (Algo) Understanding CVP…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Required information The Foundational 15 (Algo) [LO10-1, LO10-2] [The following information applies to the questions displayed below.] Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income. $ 1,200,000 320,000 880,000 640,000 $ 240,000 Average operating assets $ 600,000 At the beginning of this year, the company has a $150,000 investment opportunity with the following cost and revenue characteristics: Sales Contribution margin ratio Fixed expenses $ 240,000 50 % of sales $ 84,000 The company's minimum required rate of return is 15%. Foundational 10-9 (Algo) 9. If the company pursues the investment opportunity and otherwise performs the same as last year, what ROI will it earn this year? (Do not round intermediate calculations. Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).) ROI %
None
Exercise 7-5 (Algo) Companywide and Segment Break-Even Analysis [LO7-5] Piedmont Company segments its business into two regions-North and South. The company prepared the contribution format segmented income statement as shown: Sales Variable expenses Contribution margin Traceable fixed expenses Segment margin Common fixed expenses Net operating income Total Company $ 800,000 560,000 240,000 122,000 118,000 52,000 $ 66,000 1. Dollar sales for company to break-even 2. Dollar sales for North segment to break-even 3. Dollar sales for South segment to break-even North $ 600,000 480,000 120,000 61,000 $ 59,000 < Prev Required: 1. Compute the companywide break-even point in dollar sales. 2. Compute the break-even point in dollar sales for the North region. 3. Compute the break-even point in dollar sales for the South region. (For all requirements, round your intermediate calculations to 2 decimal places. Round your final answers to the nearest dollar.) South $ 200,000 ‒‒‒ 2 of 2 www ‒‒‒…
Exercise 6-12 (Algo) Multiproduct Break-Even Analysis [LO6-9] Olongapo Sports Corporation distributes two premium golf balls-Flight Dynamic and Sure Shot. Monthly sales and the contribution margin ratios for the two products follow: Product Flight Dynamic Sales CM ratio $ 660,000 Sure Shot $340,000 68% 76% Total $1,000,000 ? Fixed expenses total $567,000 per month. Required: 1. Prepare a contribution format income statement for the company as a whole. 2. What is the company's break-even point in dollar sales based on the current sales mix? 3. If sales increase by $57,000 a month, by how much would you expect the monthly net operating income to increase?
None
Exercise 10-9 (Algo) Return on Investment (ROI) and Residual Income Relations [LO10-1, LO10-2] A family friend has asked your help in analyzing the operations of three anonymous companies operating in the same service sector industry. Supply the missing data in the table below: (Loss amounts should be Indicated by a minus sign. Do not round your Intermediate calculations.) Sales Net operating income Average operating assets Return on investment (ROI) Minimum required rate of return: Percentage Dollar amount Residual income Company A Company B Company C $ 450,000 $ 650,000 $ 610,000 $ 44,000 $ 166,000 24 % $ 155,000 19 % % 13 % % 10 % $ 51,000 $ 7,000
Number 3
Exercise 6-11 (Algo) Segmented Income Statement [LO6-4] Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses as shown by its most recent monthly contribution format income statement: Sales Variable expenses Contribution margin Fixed expenses Net operating income (loss) In an effort to resolve the problem, the company wants to prepare an income statement segmented by division. Accordingly, the Accounting Department provided the following information: Sales Variable expenses as a percentage of sales Traceable fixed expenses $ 1,601,000 649,870 951,130 1,046,000 $ (94,870) East $ 391,000 47% $ 269,000 Req 1 Complete this question by entering your answers in the tabs below. Req 2A Division Central $630,000 39% $ 326,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department believes increasing the West Division's monthly advertising by $29,000 will increase that division's sales by 12%.…
Exercise 12-40 (Algo) Single versus Dual Rates (LO 12-5, 6) Kentfield Advisory Services (KAS) is a large management consulting firm organized into two groups: Governmental Services (GS) and Commercial Support (CS). Corporate information technology (IT) services support both groups. The cost of computer support is $48 million. The following information is given: Governmental Services Commercial Support Utilization 42% 58 Revenues (5000) $ 242,820 441,180 Required: What is the cost allocation if fixed IT costs of $37.4 million are allocated on the basis of utilization and the remaining costs (all variable) are allocated on the basis of group revenues? Note: Do not round intermediate calculations. Enter your answers in dollars, not in millions or thousands.
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