Problem 7The Moore Company had the following revenues and costs per unit based on the production and sale of 30,000units:Selling PriceDirect MaterialsDirect LaborVariable manufacturing OverheadFixed Manufacturing OverheadSales CommissionsSales SalariesAdministrative Salaries$ 75 per unit$ 15 per unit$ 25 per unitper unit$9$ 8 per unit$5 per unit$ 4 per unit$ 11 per unitTheir present plant capacity is 50,000 units per year, which can be increased in increments of 10,000 units at acost of $50,000 per increment.Required:How many units would the company have to produce and sell if they desired net income of $ 220,000? Problem 7 The Moore Company had the following revenues and costs per unit based on the production and sale of 30,000 units: Selling Price Direct Materials Direct Labor Variable manufacturing Overhead Fixed ManufacturingOverhead Sales Commissions Sales Salaries Administrative Salaries $75 per unit $15 per unit $25 per unit $9 per unit $8 per unit $5 per unit $4 per unit $11 per unit Their present plant capacity is 50,000 units per year, which canbe increased in increments of 10,000 units at a cost of $50,000 per increment. Required: How many units would the company have to produce and sell if they desired net income of $220,000 ?

Desired net income refers to the specific profit amount a company aims to achieve within a defined…

Answered: Required: How many units would the…

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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Carla Vista Company is considering two alternatives. Alternative A will have sales of $154,800 and costs of $100,100. Alternative B will have sales of $181,400 and costs of $131,800. Compare alternative A with alternative B showing incremental revenues, costs, and net income. (If an amount reduces the net income then enter with a negative sign preceding the number, e.g. -15,000 or parenthesis, e.g. (15,000).) Revenues Costs Net income $ Alternative A is better than Alternative A Alternative B eTextbook and Media $ Alternative B $ Net Income Increase (Decrease)
Q1. Below is the projected financial information provided by Altaf Hussain Manufacturing LLC. The company wants to introduce two new products into the market, Zandu and Eundu. The company provides the following forecasted information of sales and costs. Sales in units Product/Year Year 1 Year 2 Year 3 Year 4 Zandu 60,000 110,000 100,000 30,000 Eundu 75,000 137,000 125,000 37,500 Product Zandu Eundu Direct material costs 14 11 Selling price 31 23 Selling price inflation (per year). 3% Direct material cost inflation (per year) 3% Advertisement cost (First Year) 500,000 Advertisement cost (2nd and 3rd Year) 200,000 Investment 1,000,000 Machinery 1,000,000 Fixed costs 1,000,000 Таx 25% Residual value 1.2million Required: Calculate NPV and IRR of this proposal project using MS Excel. Hint: Calculate expected revenue 2. Expected costs 3. Expected cashflows 1. to calculate NPV and IRR MTEES
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Q3. If sales are $500,000, variable cost are $200,000, and fixed costs are $240,000, what is the contribution margin ratio? Answer: ______________________________________________________________________ Explain your answer: ______________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
A company’s sales figure is £250,000 and its margin of safety ratio is 40%. Assuming that the fixed costs, the variable cost per unit and the selling price per unit do not change, the company’s margin of safety for sales of £325,000 will be: a. £175,000 b. £150,000 c. £100,000 d. £70,000
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Zachia Ltd provides the following data regarding its four product lines: Product Sales mix Weighted average contribution margin per unit (WACMU) Fixed costs Desired profit after tax w Y 60 20 15 $13.7 $71,000 $33,950 The corporate tax rate is 30% Required Calculate the number of units of Product X that must be sold in order to achieve the desired after-tax profit?

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Required: How many units would the company have to produce and sell if they desired net income of $ 220,000?