Want step by step answer for this general accounting question Kanek's contribution margin is 40%.The company is contemplating anadvertising campaign that will cost$29,067. If sales are expected toincrease $90,114, by how much willthe company's net income increase?

Explanation of Contribution MarginThe contribution margin is the percentage of each sales dollar…

Answered: Kanek's contribution margin is 40%. The…

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 Answer each of the following questions independently. As far as possible use the expanded contribution margin model to present your answers. Calculate the total Contribution Margin and Operating Profit (Loss) if all 30 000 pallets are Sold. .calculate the margin of safety (as a percentage) for 2022 Use the contribution margin ratio to calculate the sales value required to achieve an operating profit of R6 000 000. Suppose an additional R300 000 is spent on advertising in order to increase the sales by 3 000 Calculate the number of pallets that need to be produced and sold to break even. Suppose the management team of…
Pool Company's variable expenses are 36% of sales. Pool is contemplating an advertising campaign that will cost $20,000. If sales increase by $80,000, the company's net operating income should increase by how much?
Solve the following independent cases and label your supporting computations properly. A) The company's projected profit for the coming year is as follows: Total P 200,000' 120,000 80,000 64,000 16,000 Per Unit P 20 Sales Less: Variable Costs 12 P 8 Contribution Margin P Less: Fixed Costs Net Income 1. Compute the additional profit that the company would earn if sales were P25,000 more than expected. B) KTA sells a special type of health food at a price of P16 per pound. Last year, it purchases this food from its supplier at a cost of P12 per pound. The supplier informed KTA that its cost increases and that this product will now be priced at P14 a pound. Over the years, KTA established a steady market and intends to pass the cost increase along to its customers and also add a P1 per unit to the price for additional profit. Fixed cost for the year are not expected to change and will remain at P34,000. Income tax rate is 32%. The net income after tax last year was P24,000. 2. If KTA can…
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1. Russ Company sold 600 units of smartphones in 2020. Each product has a variable cost of $100 and was sold at $400. The company’s fixed cost was $15,000. In 2021, the company projected a net profit of $175,800.Using the contribution margin technique: a. How many units does the company need to sell in 2020 to reach their break evenpoint? b. How many sales in dollars does the company need in 2020 to reach their breakeven point? c. How many units does the company need to sell in 2021 to reach their targetedincome? d. How many sales in dollars does the company need in 2021 to reach theirtargeted income?
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Kanek's contribution margin is 40%. The company is contemplating an advertising campaign that will cost $29,067. If sales are expected to increase $90,114, by how much will the company's net income increase?