4 Exercise 10-2 (Algo) Residual Income [LO10-2]Juniper Design Limited of Manchester, England, is a company specializing in providing design services to residential developers. Lastyear the company had net operating income of $490,000 on sales of $2,000,000. The company's average operating assets for theyear were $2,200,000 and its minimum required rate of return was 13%.Required:Compute the company's residual income for the year.Residual income

The net operating income earned in excess of the minimum return on operating assets invested is…

Answered: Juniper Design Limited of Manchester,…

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter10: Evaluating Decentralized Operations

Section: Chapter Questions

Problem 5BE: Residual income The Commercial Division of Galena Company has operating income of 12,680,000 and...

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P10-8 Break-even analysis The production of a new product required Zion Manufacturing Co. to lease additional plant facilities. Based on studies, the following data have been made available: Estimated annual sales—24,000 units Amount Per unit Estimated costs: Materials .......................................... $ 96,000 $4.00 Direct labor........................................ 14,400 0.60 Factory overhead ................................. 24,000 1.00 Administrative expense........................... 28,800 1.20 Total............................................. $163,200 $6.80 Selling expenses are expected to be 5% of sales, and net income is to amount to $2.00 per unit. Required: 1. Calculate the selling price per unit. (Hint: Let “X” equal the sell- ing price and express selling expense as a percentage of “X.”) 2. Prepare an absorption costing income statement for the year ended December 31, 2016.…
Problem#3 The Bach Company produces pffice chairs. The price of the chairs is $99.75 and the variable cost chair is $49.75 the following fixed cost is incurred: Depreciation of plant and equipment per year $20,000 Property Tax per year Variable Overhead $12,000 $5,200 Perform breakeven analysis of this company: b) What is the total cost function? c) What is the profit function? d) What is the breakeven point in units in number of chairs? e) What is the revenue ate the breakeven point? f) Estimate the profit when 1500 chairs are produced in a year? g) How many chairs must be sold for the company to make $750000 in a year?
10 ts Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows: Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margin Fixed expenses: Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 6 General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. tCommon costs allocated on the basis of sales dollars. $ 139,000 55,000 22,000 29,000 107,000 Answer is not complete. $ 95,000 X 43,000* 126,000 13,000 47,000+ Required: What is the financial advantage (disadvantage) of…
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p.8
Break-even sales under present and proposed conditions Kearney Company, operating at full capacity, sold 400,000 units at a price of $246.60 per unit during 20Y5. Its income statement for 20Y5 is as follows: The division of costs between fixed and variable is as follows: Management is considering a plant expansion program that will permit an increase of $8,631,000 (35.000 units at $246.60) in yearly sales. The expansion will increase fixed costs by $3,600,000 but will not affect the relationship between sales and variable costs. Instructions Determine for 20Y5 the total fixed costs and the total variable costs.
Break-even sales under present and proposed conditions Kearney Company, operating at full capacity, sold 400,000 units at a price of $246.60 per unit during 20Y5. Its income statement for 20Y5 is as follows: The division of costs between fixed and variable is as follows: Management is considering a plant expansion program that will permit an increase of $8,631,000 (35.000 units at $246.60) in yearly sales. The expansion will increase fixed costs by $3,600,000 but will not affect the relationship between sales and variable costs. Instructions Determine the maximum operating income possible with the expanded plant.
Residual income The Commercial Division of Galena Company has operating income of 12,680,000 and assets of 74,500,000. The minimum acceptable return on assets is 12%. What is the residual income for the division?
KIMEP BCB Task 1-CVP SINGLE PRODUCT- The Arman Company manufactures and sells pens. Present sales output is 5,000,000 units per year at a sel price of KZT 50 per unit. Fixed costs are KZT 9,000,000 per year. Variable costs are KZT 30 per unit. Required: a. What is the present breakeven point in revenues? ( Now Arman is considering adding two more products: pencils and erasers Relevant information for their production is as follows: Pencils KZT75 KZT30 Sales price Erasers 60 30 Variable Costs per unit Fixed costs for the reporting year remain at the same level while the sales mix is predicted as 40:60:20 respectively for pens, pencils and erasers respectively. Required: b. What is the company's breakeven point in units, assuming that the given sales mix is maintained? Calculate the quantities of each product. Bry

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