Ans please Kendall Company has sales of 1,000 units at $60a unit. Variable expenses are 30% of the sellingprice. If total fixed expenses are $30,000, what isthe degree of operating leverage?

Step 1: Definition of Operating LeverageOperating leverage measures how sensitive a company's…

Answered: Kendall Company has sales of 1,000…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 36P: Faldo Company produces a single product. The projected income statement for the coming year, based...

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Faldo Company produces a single product. The projected income statement for the coming year, based on sales of 200,000 units, is as follows: Required: 1. Compute the unit contribution margin and the units that must be sold to break even. Suppose that 30,000 units are sold above the break-even point. What is the profit? 2. Compute the contribution margin ratio and the break-even point in dollars. Suppose that revenues are 200,000 greater than expected. What would the total profit be? 3. Compute the margin of safety in sales revenue. 4. Compute the operating leverage. Compute the new profit level if sales are 20 percent higher than expected. 5. How many units must be sold to earn a profit equal to 10 percent of sales? 6. Assume the income tax rate is 40 percent. How many units must be sold to earn an after-tax profit of 180,000?
What is the degree of operating leverage for this accounting question?
What is the degree of operating leverage?
Kendall Company has sales of 1,990 units at $63 a unit. Variable expenses are 42% of the selling price. If total fixed expenses are $64,000, what is the degree of operating leverage? Provide answer
Kendall company has sales...I need answer
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Kendall Company has sales of 1,990 units at $63 a unit. Variable expenses are 42% of the selling price. If total fixed expenses are $64,000, what is the degree of operating leverage?
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Acme Company has sales of 2,375 units at $40 per unit. Variable expenses are 20% of the selling price. If total fixed expenses are $66,000, the degree of operating leverage is: O 1.90 O 9.50 O 2.07 O 7.60
Carson company has sales
Boom Company has sales volume of 70,000 units with a unit selling price of $120 per unit. The variable expenses are $80 per unit, and the total fixed expenses are $2,100,000. 15. What is the degree of operating leverage? * 2.00 3.00 4.00 5.00 None of the above 16. If the sales volume increases by 15%, and all other items are the same, what will be the effect on the net operating income? * The net operating income will increase by $420,000 The net operating income will increase by $700,000 The net operating income will increase by $1,120,000 The net operating income will increase by $2,800,000 None of the above O O O
What is the degree of operating leverage?

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