Last month when Holiday Creations, Incorporated, sold 44,000 units, total sales were $176,000, total variable expenses were$128,480, and fixed expenses were $39,300.Required:1. What is the company's contribution margin (CM) ratio?2. What is the estimated change in the company's net operating income if it can increase sales volume by 525 units and total sales by$2,100? (Do not round intermediate calculations.)1. Contribution margin ratio2. Estimated change in net operating income%

The contribution margin ratio is a percentage that represents how much of each sales dollar…

Answered: Last month when Holiday Creations,…

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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Bolding Inc's contribution margin ratio is 64% and its fixed monthly expenses are $44,500. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $131,000?
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1. Analysis and Critical Thinking For the month of January, Organic Food had a revenue of P500,000, variable expenses of P400,000, and fixed expenses of P85,000. In order for the company to earn P100,000 of profit for February, how much should the revenue be?
! Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Selling price Variable expenses Contribution margin Fixed expenses are $74,000 per month and the company is selling 4,400 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,800, the monthly sales volume increases by 100 units, and the total monthly sales increase by $7,000? 1-b. Should the advertising budget be increased? Req 1A Per Unit $ 70 49 $ 21 Complete this question by entering your answers in the tabs below. Req 1B Percent of Sales 100% 70 30% Net operating income How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,800, the monthly sales volume increases by 100 units, and the total monthly sales increase by $7,000? Note: Do not round intermediate calculations. by
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Last month when Holiday Creations, Incorporated, sold 43,000 units, total sales were $172,000, total variable expenses were $137,600, and fixed expenses were $36,300. Required: 1. What is the company's contribution margin (CM) ratio? 2. What is the estimated change in the company's net operating income if it can increase sales volume by 325 units and total sales by $1,300? (Do not round intermediate calculations.) 1. Contribution margin ratio 2. Estimated change in net operating income %
Last month when Holiday Creations, Incorporated, sold 44,000 units, total sales were $176,000, total variable expenses were $147,840, and fixed expenses were $39,300. Required: 1. What is the company’s contribution margin (CM) ratio? 2. What is the estimated change in the company’s net operating income if it can increase sales volume by 375 units and total sales by $1,500? (Do not round intermediate calculations.)
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