Posters.com is an Internet retailer of high-quality posters. The company has $750,000 in operating assets and fixed expenses of $156,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $4,800,000 per year. The company's contribution margin ratio is 9%, which means an additional dollar of sales results in additional contribution margin, and net operating income, of 9 cents. Required: 1. Complete the following table showing the relation between sales and return on investment (ROI). 2. What happens to the company's return on investment (ROI) as sales increase? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the following table showing the relation between sales and return on investment (ROI). Note: Round your percentage answers to 2 decimal places. Sales $ 4,300,000 $ 231,000 $4,400,000 $ 4,500,000 $ 4,600,000 Net Operating Income $4,700,000 $ 4,800,000 Average Operating Assets 750,000 $ 750,000 $ 750,000 $ 750,000 $ 750,000 $ 750,000 ROI % < Required 1 Required 2 >

Posters.com is an Internet retailer of high-quality posters. The company has $750,000 in operating assets and fixed expenses of $156,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $4,800,000 per year. The company's contribution margin ratio is 9%, which means an additional dollar of sales results in additional contribution margin, and net operating income, of 9 cents. Required: 1. Complete the following table showing the relation between sales and return on investment (ROI). 2. What happens to the company's return on investment (ROI) as sales increase? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the following table showing the relation between sales and return on investment (ROI). Note: Round your percentage answers to 2 decimal places. Sales $ 4,300,000 $ 231,000 $4,400,000 $ 4,500,000 $ 4,600,000 Net Operating Income $4,700,000 $ 4,800,000 Average Operating Assets 750,000 $ 750,000 $ 750,000 $ 750,000 $ 750,000 $ 750,000 ROI % < Required 1 Required 2 >

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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Posters.com is a small Internet retailer of high-quality posters. The company has $890,000 in operating assets and fixed expenses of $170,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $4,600,000 per year. The company's contribution margin ratio is 11%, which means that an additional dollar of sales results in additional contribution margin, and net operating income, of 11 cents. Required: 1. Complete the following table showing the relation between sales and return on investment (ROI). 2. What happens to the company's return on investment (ROI) as sales increase?
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Marsh Motors sells 5,000 motors a year for $30 apiece. Variable costs are $8 per unit, and total fixed costs are $85,000 a year. If the company wants to earn $6 net income per motor sold, approximately how many motors must it sell?
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Vinubhai
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