Oslo Company prepared the following contribution format income statement based on a sales volume of1,000 units (the relevant range of production is 500 units to 1,500 units):SalesVariable expensesContribution marginFixed expensesNet operating income$ 20,00012,0008,0006,000$ 2,000Foundational 6-14 (Static)14. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In otherwords, assume that the total variable expenses are $6,000 and the total fixed expenses are $12,000. Under this scenarioand assuming that total sales remain the same, what is the degree of operating leverage?Degree of operating leverage

The objective of the question is to calculate the degree of operating leverage for Oslo Company…

Answered: Oslo Company prepared the following…

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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Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 20,000 12,000 8,000 6,000 $ 2,000 Foundational 6-13 (Static) 13. Using the degree of operating leverage, what is the estimated percent increase in net operating income that would result from a 5% increase in unit sales? Increase in net operating income 96
Required information [The following information applies to the questions displayed below.] Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): $ 15,000 9,000 6,000 3,120 Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 2,880 6. If the selling price increases by $2 per unit and the sales volume decreales by 100 units, what would be the net operating income? $ 3,000 Net operating income
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales $ 85,000 Variable expenses 59,500 Contribution margin 25,500 Fixed expenses 20,400 Net operating income $ 5,100 14. Assume that the amounts of the company’s total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $20,400 and the total fixed expenses are $59,500. Under this scenario and assuming that total sales remain the same, what is the degree of operating leverage? (Round your answer to 2 decimal places.)
s
Required information [The following information applies to the questions displayed below.] Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): $ 45,000 31,500 Sales Variable expenses Contribution margin Fixed expenses 13,500 8,640 Net operating income $ 4,860 10. How many units must be sold to achieve a target profit of $8,100? Number of units
Piedmont Company segments its business into two regions-North and South. The company prepared the contribution format segmented income statement as shown: Sales Variable expenses Contribution margin Traceable fixed expenses Segment margin Common fixed expenses Net operating income Total Company $ 937,500 637,500 300,000 142,000 158,000 62,000 $ 96,000 North $ 750,000 600,000 150,000 71,000 $ 79,000 Required: 1. Compute the companywide break-even point in dollar sales. 2. Compute the break-even point in dollar sales for the North region. 3. Compute the break-even point in dollar sales for the South region. South $ 187,500 37,500 150,000 71,000 $ 79,000
Required information [The following information applies to the questions displayed below.] Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 60,000 39,000 Net operating income 21,000 14,700 $ 6,300 Required: 5. If sales decline to 900 units, what would be the net operating income? Note: Round "Per Unit" calculations to 2 decimal places.
Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales $ 15,000 Variable expenses 9,000 Contribution margin 6,000 Fixed expenses 3,120 Net operating income $ 2,880 14. Assume that the amounts of the company’s total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $3,120 and the total fixed expenses are $9,000. Under this scenario and assuming that total sales remain the same, what is the degree of operating leverage? (Round your answer to 2 decimal places.)
4 Womack Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range. Sales (9,000 units) Variable expenses Contribution margin Fixed expenses Net operating income The margin of safety percentage is closest to: O 75% 1% O 6% O 24% $ 270,000 202,500 67,500 63,750 $3,750
range of production is 500 units to 1,500 units): Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant Mc Graw Hill 'Z² ± 080 2 A Sales Variable expenses Contribution margin Z Fixed expenses Net operating income Contribution margin per unit 2 Required: What is the contribution margin per unit? (Round your answer to 2 decimal places.) F2 ((1:1) @ W S F3 # 3 X Alt / £ E D F4 $ 4 $ C ¢ $ R 23,900 13,300 10,600 7,632 2,968 F F5 OIO % 5 V F6 粥 ¤ T G л 6 B F7 ? Y H F8 & 7 N Jy L § F12 ) 0 14 Alt Car Scr Lk Arrêtdef P - PrtSc/Imprecr. SysRq/Syst. 目 1½/2 2 + 11 ? Pause Break/Interr. 1 | | ^ = 3/4 A } >> \ o « Insert ]] < Delete/Suppr. V. A V 1 ▷

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