Phoenix Manufacturing produces 2,500 units of specialty components, selling them at $40 per unit. Their variable costs are 40% of the selling price, and total fixed expenses are $35,000. Calculate the degree of operating leverage (DOL).
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![Phoenix Manufacturing produces 2,500 units of specialty components,
selling them at $40 per unit. Their variable costs are 40% of the selling
price, and total fixed expenses are $35,000. Calculate the degree of
operating leverage (DOL).](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F65a55d4a-f5eb-454e-ad0f-8bf616d9cf43%2Fdb977bba-571e-4b4c-bafa-d78d06ffd44d%2Fmdzqpv6_processed.jpeg&w=3840&q=75)
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- Manatoah Manufacturing produces 3 models of window air conditioners: model 101, model 201, and model 301. The sales price and variable costs for these three models are as follows: The current product mix is 4:3:2. The three models share total fixed costs of $430,000. Calculate the sales price per composite unit. What is the contribution margin per composite unit? Calculate Manatoahs break-even point in both dollars and units. Using an income statement format, prove that this is the break-even point.Polaris Inc. manufactures two types of metal stampings for the automobile industry: door handles and trim kits. Fixed cost equals 146,000. Each door handle sells for 12 and has variable cost of 9; each trim kit sells for 8 and has variable cost of 5. Required: 1. What are the contribution margin per unit and the contribution margin ratio for door handles and for trim kits? 2. If Polaris sells 20,000 door handles and 40,000 trim kits, what is the operating income? 3. How many door handles and how many trim kits must be sold for Polaris to break even? 4. CONCEPTUAL CONNECTION Assume that Polaris has the opportunity to rearrange its plant to produce only trim kits. If this is done, fixed costs will decrease by 35,000, and 70,000 trim kits can be produced and sold. Is this a good idea? Explain.A company expects to sell 75,000 widgets at a price of $10.00. The unit variable costs are estimated at $8.00, and the fixed costs are estimated at $125,000. On the basis of this information, calculate the following: 1. Contribution margin 2. PV ratio 3. Revenue break-even by using the PV ratio 4. Profit generated
- Sunn Company manufactures a single product that sells for $110 per unit and whose variable costs are $88 per unit. The company's annual fixed costs are $308,000. Management targets an annual income of $550,000. (1) Compute the unit sales to earn the target income. Numerator: Denominator: (2) Compute the dollar sales to earn the target income. Numerator: Denominator: = = = = Units to Achieve Target Units to achieve target Dollars to Achieve Target Dollars to achieve targetBlanchard Company manufactures a single product that sells for $136 per unit and whose total variable costs are $102 per unit. The company's annual fixed costs are $496,400. Management targets an annual pretax income of $850,000. Assume that fixed costs remain at $496,400. (1) Compute the unit sales to earn the target income. Choose Numerator: Fixed costs plus pretax income Choose Denominator: = Units to Achieve Target Contribution margin per unit = Units to achieve target 0 (2) Compute the dollar sales to earn the target income. Choose Numerator: Fixed costs plus pretax income Choose Denominator: Dollars to Achieve Target 1 Contribution margin ratio = Dollars to achieve target 0Crane Designs has fixed costs of $229,600 and produces one graphic arts product with a selling price of $85 and variable costs of $45 per unit. Crane is currently selling 10,865 units. (a) What is Crane Design's degree of operating leverage (DOL)? (Round answer to 2 decimal places, e.g. 5.25.) Your answer is correct. (b) Degree of operating leverage (DOL) (c) eTextbook and Media Your answer is correct. If sales revenues are expected to increase by 10%, what will be the expected operating profit? Expected operating profit $ eTextbook and Media * Your answer is incorrect. Expected net income Based on the above, what would be Crane's expected net income if its effective tax rate is 30%? eTextbook and Media 248,460 Save for Later 212 1,017,151 Attempts: unlimited Attempts: unlimited Attempts: unlimited Submit Answer
- Natasha Industries has a product with a selling price per unit of $136, the unit variable cost is $46, and the total monthly fixed costs are $300,000. How much is Natasha contribution margin ratio?Willie Company sells 30,000 units at $29 per unit. Variable costs are $20.30 per unit, and fixed costs are $138,300. Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) operating income.Glover Inc. manufactures Product B, incurring variable costs of $15.00 per unit and fixed costs of $70,000. Glover desires a profit equal to a 12% rate of return on assets. Assets of $785,000 are devoted to producing Product B, and 100,000 units are expected to be produced and sold. a. Compute the markup percentage using the total cost concept.fill in the blank 1 % b. Compute the selling price of Product B. Round your answer to two decimal places.$fill in the blank 2
- Bluegill Company sells 10,000 units at $400 per unit. Fixed costs are $200,000, and operating income is $1,800,000. Determine the following: a. Variable cost per unit $ b. Unit contribution margin $ per unit c. Contribution margin ratio %Natasha Industries has a product with a selling price per unit of $136, the unit variable cost is $46, and the total monthly fixed costs are $300,000. How much is Natasha's contribution margin ratio?KN Enterprises produces a single part for sale. The part sells for $19 per unit. Fixed costs are $1,420,000 annually. Production and sales of 640,000 units annually result in profit before taxes of $2,350,000. What is the unit variable cost? Provide answer
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