Accounting. The operating levaragyis. Morse Company reports a total contributionmargin of $48,000 and pretax net income of$12,000 for the current month. The degree ofoperating leverage is:a) 4.0b) 0.25c) 1.25d) 2.5e) 250%

Step 1:- Define Degree of Operating LeverageThe degree of operating leverage calculates the effect…

Answered: Morse Company reports a total…

Principles of Accounting Volume 2

19th Edition

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Chapter3: Cost-volume-profit Analysis

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Problem 23MC: If a firm has a contribution margin of $78M90 and a net income of $13,700 for the current month,...

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Subject:- Accounting
Jellico Inc.’s projected operating income (based on sales of 450,000 units) for the coming year isas follows:TotalSales $11,700,000Total variable cost 8,190,000Contribution margin $ 3,510,000Total fixed cost 2,254,200Operating income $ 1,255,800Required:1. Compute: (a) variable cost per unit, (b) contribution margin per unit, (c) contribution margin ratio, (d) break-even point in units, and (e) break-even point in sales dollars.2. How many units must be sold to earn operating income of $296,400?3. Compute the additional operating income that Jellico would earn if sales were $50,000 morethan expected.4. For the projected level of sales, compute the margin of safety in units, and then in salesdollars.5. Compute the degree of operating leverage. (Note: Round answer to two decimal places.)6. Compute the new operating income if sales are 10% higher than expected.
Operating leverage Haywood Co. reports the following data: Line Item Description Amount Sales $6,160,000 Variable costs (4,620,000) Contribution margin $1,540,000 Fixed costs (440,000) Operating income $1,100,000 Determine Haywood Co.’s operating leverage. Round your answer to one decimal place.
If the contribution margin ratio for France Company is 32%, sales are $488,000, and fixed costs are $110,000, the operating income is Oa. S110,000 Ob. $46,160 Oc. $36,928 Od. S156,160 Previous Submit Te Reflector-3.2.1.dmg
The February contribution format income statement of Mcabier Corporation appears below: Sales $ 211,200 Variable expenses 96,000 Contribution margin 115,200 Fixed expenses 84,100 Net operating income $ 31,100 The degree of operating leverage is closest to: a/ 0.27 b/ 6.79 c/ 3.70 d/ 0.15
Operating Leverage Haywood Co. reports the following data: Sales $6,160,000 Variable costs (4,620,000) Contribution margin $1,540,000 Fixed costs (440,000) Operating income $1,100,000 Determine Haywood Co.’s operating leverage. Round your answer to one decimal place.
Green Valley Corp.'s contribution format income statement for the most recent month follows: Sales $ 506,000 Variable expenses 236,500 Contribution margin 269,500 Fixed expenses 241,700 Net operating income $ 27,800 Required: a. Compute the degree of operating leverage to two decimal places. b. Using the degree of operating leverage, estimate the percentage change in net operating income that should result from a 3% increase in sales. c. If Green Valley’s competitor Black Mountain Inc. has a degree of operating leverage as 8, which company has the higher operating risk?
Morse Company reports total contribution margin of $63,210 and pretax net income of $12,900 for the current month. The degree of operating leverage is:
Whirly Corporation's contribution format income statement for the most recent month is shown below: Sales (7,600 unita) Variable expenses Total $ 243,200 136, 800 Per Unit $32.00 18.00 Contribution nargin 106,400 $ 14.00 ried expenses 55,000 5 51,400 et operating Lncone Required: (Consider each case independently): 1 What would be the revised net operating income per month if the sales volume increases by 50 units? 2 What would be the revised net operating income per month if the sales volume decreases by 50 units? 3. What would be the revised net operating income per month if the sales volume is 6,600 units? 1. Revined net operating income 2. Revised net operating income 3. Revised net operating income
A company sells one product and its contribution margin ratio is 10%. The company provides the following data regarding their operation: Current sales revenue $3,540,000 $3,681,600 Expected sales revenue next year Expected increase in net operating income next year 12% Q. What is the net operating income for the current year? ANS. $
Tucker Enterprises produces a single product. Following is the projected income statement for the upcoming year: Sales (51,000 units @ $40 per unit) $2,040,000 Total variable cost 774,900 Contribution margin 1,265,100 Total fixed cost 955,500 Operating income $309,600 Compute the degree of operating leverage. Round answer to two decimal places. Select one: C a. 17.33 b. 3.09 c. 4.09 d. 1.61 e. 2.63` оос O
Assume MIX Incorporated has sales volume of $1,162,000 for two products with May sales and contribution margin ratios as follows: Product A: Sales $454,000; Contribution Margin Ratio 30% Product B: Sales $708,000; Contribution Margin Ratio 60% Required: Assume MIX's fixed expenses are $318,000. Calculate the May total contribution margin, operating income, average contribution margin ratio, and breakeven sales volume. Note: Round "Average contribution margin ratio" answer to 2 decimal places. Round up "Breakeven sales volume" answer to nearest whole dollar. Total contribution margin Operating income Average contribution margin ratio Breakeven sales volume %

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Morse Company reports a total contribution margin of $48,000 and pretax net income of $12,000 for the current month. The degree of operating leverage is: a) 4.0 b) 0.25 c) 1.25 d) 2.5 e) 250%