Grixdale Tax Services prepares taxes for individuals. Grixdale offers a simplified pricing model with two alternatives for taxpayers: Standard Deduction (Standard) or Itemized Deductions (Itemized). Price and variable costs for the two services are listed below. Sales price (per return) Variable costs (per return) Standard $ 190.00 150.00 The annual fixed costs at Grixdale are $507,500. Based on experience, the owner estimates that Standard Deduction returns represent 25 percent of the the firm's business. Required: How many Standard Deduction and Itemized Deduction returns must be filed annually to break even? Standard Deduction returns Itemized Deduction returns Itemized $530.00 310.00 Answer is complete but not entirely correct. Break-Even Sales in Units 12,688 x 2,302 X

Grixdale Tax Services prepares taxes for individuals. Grixdale offers a simplified pricing model with two alternatives for taxpayers: Standard Deduction (Standard) or Itemized Deductions (Itemized). Price and variable costs for the two services are listed below. Sales price (per return) Variable costs (per return) Standard $ 190.00 150.00 The annual fixed costs at Grixdale are $507,500. Based on experience, the owner estimates that Standard Deduction returns represent 25 percent of the the firm's business. Required: How many Standard Deduction and Itemized Deduction returns must be filed annually to break even? Standard Deduction returns Itemized Deduction returns Itemized $530.00 310.00 Answer is complete but not entirely correct. Break-Even Sales in Units 12,688 x 2,302 X

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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Analyze Star Stream's cost-vol ume-profit relationships Star Stream is a subscription-based video streaming service. Subscribers pay $120 per year for the service. Star Stream licenses and develops content for its subscribers. In addition, Star Stream leases servers to hold this content. These costs are not variable to the number of subscribers, but must be incurred regardless of the subscriber base. In addition, Star Stream compensates telecommunication companies for bandwidth so that Star Stream customers receive fast streaming services. These costs are variable to the number of subscribers. These and other costs are as follows: Enter your answers in whole dollars. Server lease costs per year $100,000,000 Content costs per year 2,000,000,000 Fixed operating costs per year 900.000,000 Bandwidth costs per subscriber per year 15 Variable operating costs per subscriber per year 25 a. Determine the break-even number of subscribers. subscribers b. Assume Star Stream planned to increase…
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For the next 2 items. Markgil Corp. manufactures a product that yields the by-product "Yum". The only costs associated with Yum are selling costs of P.10 for each unit sold. Abel accounts for sales of Yum by deducting Yum's separable costs from Yum's sales, and then deducting this net amount from the major product's cost of goods sold. Yum's sales were 100,000 units at P1.00 each. If Markgil changes its method of accounting for Yum's sales by showing the net amount as additional sales revenue, then Markgil's gross margin would * a. Increase by P90,000 b. Decrease by P90,000 c. Increase by P100,000 d. Increase by P100,000 e. Be unaffected If Markgil changes its method of accounting for Yum's sales by showing the net amount as other income, then Markgil's gross margin would * a. Increase by P90,000 b. Decrease by P90,000 c. Increase by P100,000 d. Increase by P110,000 e. Be unaffected
Thomas Consultants provided Bran Construction with assistance in implementing various cost-savings initiatives. Thomas’s contract specifies that it will receive a flat fee of $70,000 and an additional $40,000 if Bran reaches a prespecified target amount of cost savings. Thomas estimates that there is a 30% chance that Bran will achieve the cost-savings target. Required: Assuming Thomas uses the expected value as its estimate of variable consideration, calculate the transaction price. Assuming Thomas uses the most likely value as its estimate of variable consideration, calculate the transaction price. Assume Thomas uses the expected value as its estimate of variable consideration, but is very uncertain of that estimate due to a lack of experience with similar consulting arrangements. Calculate the transaction price.
Thomas Consultants provided Bran Construction with assistance in implementing various cost-savings initiatives. Thomas's contract specifies that it will receive a flat fee of $56,000 and an additional $26,000 if Bran reaches a prespecified target amount of cost savings. Thomas estimates that there is a 20% chance that Bran will achieve the cost-savings target. Required: 1. Assuming Thomas uses the expected value as its estimate of variable consideration, calculate the transaction price. 2. Assuming Thomas uses the most likely value as its estimate of variable consideration, calculate the transaction price. 3. Assume Thomas uses the expected value as its estimate of variable consideration, but is very uncertain of that estimate due to a lack of experience with similar consulting arrangements. Calculate the transaction price. Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 2. Assuming Thomas uses the most likely value as its estimate of variable…
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Tim's Bicycle Shop sells 21-speed bicycles. For purposes of a cost-volume-profit analysis, the shop owner has divided sales into two categories, as follows: product type high quality medium quality price invoice cost 840 620 sales commission sales price 1850 920 100 40 Three-quarters of the shop's sales are medium-quality bikes. The shop's annual fixed expenses are $270,400. (In the following requirements, ignore income taxes.) a. What is the shop's break-even sales volume in dollars? Assume a constant sales mix. b. How many bicycles of each type must be sold to earn a target net income of $126,750? Assume a constant sales mix.
Ee.11.
The sales manager is deciding between two possible compensation structures for sales staff. Under one plan, salespeople would receive a base compensation of $80,000 per year plus a 1% commission on all sales to their customers. Under the other plan, the base compensation would drop to $40,000 per year, but the commission rate would increase to 5%. What are the advantages and disadvantages, to the company of both plans? As the accounting manager, would you have a preference? Why or why not? (answer in text form please (without image), Note: .Every entry should have narration please)
Oops, JAC forgot about taxes. Assume a tax rate of 21% Using information and your calculations from xlsx 7 determine the following: 1.) Assuming a desired after tax profit of $16,000, what is the pretax profit JAC has to earn? 2.) How many units does JAC have to sell to earn the desired after tax profit of $16,000. 225 units at $100 per unit Variable cost $20 per unit Contribution margin = Fixed costs = $18,000 Operating income = JAC has a desired profit of $16,000 1.) Calculate the number of units they need to sell to accomplish this. 2.) Calculate the dollar amount of sales they need to accomplish this. 1. Required sale for target profit = ( Fixed cost + Desired profit ) / Contribution marginContribution margin = Sales price - Variable cost = 100 - 20= 80Required sale for target profit = ( 18,000 + 16,000 ) / 80= 34,000 / 80= 425 units The dollar amount of sales for target profit =( Fixed cost + Desired profit ) / Contribution margin ratioContribution margin ratio = Contribution /…
Rylan corporation received an offer from an exporter for 25,000 units of product at $16 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data is available Domestic sales price: $22 Unit manufacturing costs: Variable: 11 Fixed: 6 A. What is the amount of income or loss from acceptance of the offer? B. What is the differential cost from acceptance of the offer?
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