Milden Company is a merchandiser planning to sell 12,000 units next quarter at a selling price of $100 per unit. The company alsogathered the following cost estimates for the next quarter:CostCost of goods soldAdvertising expenseSales commissionsShipping expenseAdministrative salariesInsurance expenseDepreciation expenseCost Formula$35 per unit sold$210,000 per quarter6% of sales$28,000 per quarter + $9.10 per unit sold$145,000 per quarter$9,000 per quarter$76,000 per quarterRequired:1. Prepare a contribution format income statement for the next quarter.2. Prepare a traditional format income statement for the next quarter.

An income statement refers to a statement that determines the income earned during the period by…

Answered: Milden Company is a merchandiser…

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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A Company produces a single product which sells for $20 per unit. Variable Cost is $15 and fixed cost for the year is $630,000 Required: (1) Calculate Sales value needed to earn profit of 10% on sales (2) Calculate sales price per unit if BEP down to 120,000 units
The BZ-91825 company charges a price of $242 per unit of its product. The company's variable cost per unit is $55. The BZ-91825 company on average sells 8,200 units per month. Fixed expenses are $878,000 per month. The company considers cutting the selling price by $29 and increasing its advertising budget by $63,000 per month. The company predicts monthly sales quantity to increase by 22%. What is the overall effect on the BZ-91825 company's monthly net operating income of these changes? (Note: A POSITIVE number indicates an INCREASE in net operating income, and a NEGATIVE number indicates a DECREASE in net operating income) Multiple Choice -15,768 dollars 63,520 dollars 13,800 dollars -63,840 dollars
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Houpe Corporation produces and sells a single product. Data concerning that product appear below: Per Unit Percent of Sales Selling price $ 140 100% Variable expenses 42 30% Contribution margin $ 98 70% Fixed expenses are $490,000 per month. The company is currently selling 6,000 units per month. The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $11 per unit. In exchange, the sales staff would accept a decrease in their salaries of $58,000 per month. (This is the company's savings for the entire sales staff.) The marketing manager predicts that introducing this sales incentive would increase monthly sales by 100 units. What should be the overall effect on the company's monthly net operating income of this change?
Sannella Corporation produces and sells a single product. Data concerning that product appear below: Selling price Variable expenses Contribution margin Per Unit $ 220 66 $ 154 Percent of Sales 100% 30% 70% Fixed expenses are $991,000 per month. The company is currently selling 8,000 units per month. The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $11 per unit. In exchange, the sales staff would accept a decrease in their salaries of $74,000 per month. (This is the company's savings for the entire sales staff.) The marketing manager predicts that introducing this sales incentive would increase monthly sales by 200 units. What should be the overall effect on the company's monthly net operating income of this change?
Stratford Company distributes a lightweight lawn chair that sells for $ 40 per unit . Variable expenses are expenses total $ 672,000 annually . 40\% of sales , and fixed Required : Answer the following independent questions : 1. What is the product's CM per unit ?Refer to the original data . Assume that the company sold 44,000 units last year . The sales manager is convinced that a 7 % reduction in the selling price , combined with a increase in advertising expenditures , would increase annual unit sales by . Prepare two contribution format income statements : one showing the results of last year's operations , and one showing what the results of operations would be if these changes were made . ( Do not round intermediate calculations . Round " Per Unit " answers to 2 decimal places . ) 30\% Answer is not complete . Last Year Proposed Total Per Unit Total Per Unit Sales Less Variable expenses Contribution margin $ 24.00 $ 7.00 Less Fixed expenses Net operating income 5 - b . Would you…
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