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Menlo Company distributes a single product. The company's sales and expenses for last month follow: Total Per Unit Sales $ 616,000 $ 40 Variable expenses 431, 200 28 Contribution margin 184,800 $ 12 Fixed expenses 147,600 $ 37,200 Net operating income Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $75,60O? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company's CM ratio? If the company can sell more units thereby increasing sales by $56,000 per month: change in fixed expenses, by how much would you expect monthly net operating income to increase? Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3A Req 3B Req 4 Req 5 What is the monthly break-even point in unit sales and in dollar sales? Break-even point in unit sales units Break-even point in dollar sales

Menlo Company distributes a single product. The company's sales and expenses for last month follow: Total Per Unit Sales $ 616,000 $ 40 Variable expenses 431, 200 28 Contribution margin 184,800 $ 12 Fixed expenses 147,600 $ 37,200 Net operating income Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $75,60O? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company's CM ratio? If the company can sell more units thereby increasing sales by $56,000 per month: change in fixed expenses, by how much would you expect monthly net operating income to increase? Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3A Req 3B Req 4 Req 5 What is the monthly break-even point in unit sales and in dollar sales? Break-even point in unit sales units Break-even point in dollar sales

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Menlo Company distributes a single product. The company's sales and expenses for last month follow: Total Per Unit $ 616,000 431,200 Sales $ 40 Variable expenses 28 Contribution margin 184,800 $ 12 Fixed expenses 147,600 Net operating income $ 37, 200 Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $75,600? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company's CM ratio? If change in fixed expenses, by how much would you expect monthly net operating income to increase? company can sell more uni thereby increasing les by ,000 per month and there is no Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req ЗA Req 3B Req 4 Req 5 What is the monthly break-even point in unit sales and in dollar sales? Break-even point in unit sales units Break-even point in dollar sales Req 1 Req 2 Req ЗA Req 3B Req 4 Req 5 Without resorting to computations, what is the total contribution margin at the break-even point? Total contribution margin Req 1 Req 2 Req 3A Req 3B Req 4 Req 5 How many units would have to be sold each month to attain a target profit of $75,600? Units sales needed to attain target profit
Transcribed Image Text:Menlo Company distributes a single product. The company's sales and expenses for last month follow: Total Per Unit $ 616,000 431,200 Sales $ 40 Variable expenses 28 Contribution margin 184,800 $ 12 Fixed expenses 147,600 Net operating income $ 37, 200 Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $75,600? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company's CM ratio? If change in fixed expenses, by how much would you expect monthly net operating income to increase? company can sell more uni thereby increasing les by ,000 per month and there is no Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req ЗA Req 3B Req 4 Req 5 What is the monthly break-even point in unit sales and in dollar sales? Break-even point in unit sales units Break-even point in dollar sales Req 1 Req 2 Req ЗA Req 3B Req 4 Req 5 Without resorting to computations, what is the total contribution margin at the break-even point? Total contribution margin Req 1 Req 2 Req 3A Req 3B Req 4 Req 5 How many units would have to be sold each month to attain a target profit of $75,600? Units sales needed to attain target profit
Req 1 Req 2 Req 3A Req 3B Req 4 Req 5 Verify your answer by preparing a contribution format income statement at the target sales level. Menlo Company Contribution Income Statement Total Per Unit Req 1 Req 2 Req ЗA Req 3B Req 4 Req 5 Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. (Round your percentage answer to 2 decimal places (i.e. 0.1234 should be entered as 12.34).) Dollars Percentage Margin of safety % Req 1 Req 2 Req ЗA Req 3B Req 4 Req 5 What is the company's CM ratio? If the company can sell more units thereby increasing sales by $56,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? CM ratio |% Net operating income increases by
Transcribed Image Text:Req 1 Req 2 Req 3A Req 3B Req 4 Req 5 Verify your answer by preparing a contribution format income statement at the target sales level. Menlo Company Contribution Income Statement Total Per Unit Req 1 Req 2 Req ЗA Req 3B Req 4 Req 5 Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. (Round your percentage answer to 2 decimal places (i.e. 0.1234 should be entered as 12.34).) Dollars Percentage Margin of safety % Req 1 Req 2 Req ЗA Req 3B Req 4 Req 5 What is the company's CM ratio? If the company can sell more units thereby increasing sales by $56,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? CM ratio |% Net operating income increases by
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