Last year, Dorothy sold 3,600 baskets, and she believes that demand this year will be stable at 3,600 baskets. The following arethe actions Dorothy could take if she wants to earn $28,000 in operating income by selling only 3,600 baskets. Consider eachaction independently. (Round per unit answers to 2 decimal places, eg. 52.75 and fixed cost to 0 decimal places, eg. 5,275.)1.23.Raise selling price per unit toReduce variable costs per unit toReduce fixed costs to$$$ Three years ago, Dorothy Taylor started a business that creates and delivers holiday and birthday gift baskets to students at the localuniversity. Dorothy sells the baskets for $33 each, and her variable costs are $23 per basket. She incurs $11,600 in fixed costs eachyear.(a)How many baskets will Dorothy have to sell this year if she wants to earn $28,000 in operating income? (Round answer to O decimalplaces, eg. 5,275)baskets

Break-even point is a level of sales at which there is no profit no loss.In other words it is a…

Answered: Last year, Dorothy sold 3,600 baskets,…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Warner clothing is considering the introudciton fo a new baseball cap for sales by local vendors. The comapny has collected the following price and cost characteristics. A. What number must Warner sell per month to break even? B. What number must Warner sell per month to make an operating profit of $30,000?
A company estimates that it can sell 4,000 units each month of its product if it prices each unit at $80. However, its monthly number of sales will increase by 15 units for each $0.15 decrease in price. The company has fixed costs of $500. The cost to make each unit is $4.60, Find the level of production that maximizes the company's profit. They should produce units at a price of $ which will yield a profit of $
Assume you are running a retail operation. You calculated weighted sales to be $225.00 per shopping cart. You looked at competitive information and found that the cost of sales for them is 85%. You would like to invest $250,000 for marketing in your business How many customers must you get to breakeven? How many customers must you get to make a 10% operating profit? how would the income statement for this to be presented per unit sale $? per unit cost of sale number of customers needed to make 10% profit total sales $$ total cost of sales gross profit marketing investment operating profit operating profit margin in % ROI
You Break It, We Fix-it Repair Shop has a monthly target profit of $18,900. Variable costs are 62% of sales, and monthly fixed costs are $7,500. (Note: 100% of Sales = Variable Costs + Contribution Margin). (Round your answers to two decimal places when needed and use rounded answers for all future calculations). 1. Compute the monthly margin of safety in dollars if the shop achieves its income goal. (Fixed Costs (Fixed Costs + + + + Expected sales - Target Profit) Target Profit) 1 1 Contribution Margin per ratio (%) Contribution Margin ratio (%) = = = = Required Sales in Dollars to Break-even Required Sales in Dollars to meet Target Profit Break-even sales = Margin of safety in dollars 2. Express what You Break It, We Fix-it Repair Shop margin of safety is as a percentage of target ales. Margin of safety in dollars/ Expected sales in dollars = Margin of safety ratio (%)
2.10 Eliza sells flowers in Covent Garden. Her fixed costs are Birr 50 per day. Her average sales price is Birr 4 per flower. She is currently selling 400 flowers per day. Her current variable cost is Birr 3 per flower. Eliza anticipates that her daily sales will increase to 500 flowers per day. How much could her variable cost per flower increase for her to still earn the same daily profits as before?
narubhai
Charlotte sells widgets which cost $50 each to purchase and prepare for sale. Annual sales are 10,000 widgets, carrying cost are 15% of inventory costs, and Charlotte incurs a cost of $25 each time an order is placed. Suppose her supplier decides to offer a 3% cash discount if products are ordered in increments of 1250. How many widgets should Charlotte order each time an order is placed to minimize costs? I have submitted this question twice and both times was answered with how many orders of 1250 will satisfy the demand of 10,000 widgets. I need to know how to figure out HOW MANY WIDGETS PER ORDER to minimize costs.
1. If the company want to achieve target net income $800,000 and the tax rate is 30%, calculate how many units to be sold to achieve those targets? 2. The owner estimates that if he can spend an additional $75,000 towards sales promotion,sales in unit may increase by 30%. What should Mr. Budi’ decision be?
7) Gregor and Greta have planned to sell 300 bags together in each market. They plan to visit 24 markets during the year, to get an idea of whether the estimated sale of candy bags in the budget is reasonable or not, gregor wants your help to make a zero point calculation based on the following information: kronor comment Selling price 30 each FK 662 000 RK 5 each a)Which is the zero point turnover? b)Will they make a profit based on the estimated number of bags of sweets sold? justify your answer and show your calculations.
Please show work
Aunt Sally's "New Orleans Most Famous Pralines" sells pralines costing $1.04 each to make. If Aunt Sally's wants a 30% markup based on selling price and produces 35 pralines with an anticipated 20% spoilage, what should each praline be sold for? (Use your unrounded "number of units available for sale" value (after accounting for spoilage). Round your answer to the nearest cent.) Selling price
solve the fiven question: Raveen Products sells camping equipment. One of the company’s products, a camp lantern, sells for $90 per unit. Variable expenses are $63 per lantern, and fixed expenses associated with the lantern total $135,000 per month. Required: Compute the company’s break-even point in number of lanterns and in total sales dollars. Compute the company’s Margin of Safety in sales dollar and in percentage. At present, the company is selling 8,000 lanterns per month. The sales manager is convinced that a 10% reduction in the selling price will result in a 25% increase in the number of lanterns sold each month. Prepare two contribution format income statements, one under present operating conditions, and one as operations would appear after the proposed changes. Show both total and per unit data on your statements. Refer to the data in (3) above. How many lanterns would have to be sold at the new selling price to yield a minimum net operating income of $72,000 per month?…

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS