Required Information[The following information applies to the questions displayed below.]Oak Mart, a producer of solld oak tables, reports the following data from its first year of business.Sales price per unitUnits produced this year.Units sold this yearVariable selling and administrative expensesFixed selling and administrative expensesDirect materialsDirect laborVariable overheadFixed overhead1. Prepare the current-year income statement using variable costing.SalesLess: Variable expensesBeginning inventoryIncomeOAK MARTIncome Statement (Variable Costing)Variable overhead costsFixed selling and administrative expenses$ 390 per unit130,000 units130,000 units$ 26 per unit$ 4,670,000 per year$ 54 per unit$ 76 per unit$ 42 per unit$ 9,490,000 per year.0

VARIABLE COSTINGVariable Costing is a Cost Managerial Accounting Method in which all Variable Cost…

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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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Milden Company is a merchandiser that plans to sell 37,000 units during the next quarter at a selling price of $61 per unit. The company also gathered the following cost estimates for the next quarter: Cost Cost Formula Cost of good sold Advertising expense $31 per unit sold $181,000 per quarter Sales commissions 6% of sales $63,000 per quarter + $4.00 per unit sold $91,000 per quarter $10,100 per quarter $61,000 per quarter Shipping expense Administrative salaries Insurance expense Depreciation expense Required: 1. Prepare a contribution format income statement for the next quarter. 2. Prepare a traditional format income statement for the next quarter. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a traditional format income statement for the next quarter. Milden Company Traditional Format Income Statement For the Next Quarter Selling and administrative expenses: Total selling and administrative expenses
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Determine the amount of sales (units) that would be necessary under Break-Even Sales Under Present and Proposed Conditions Darby Company, operating at full capacity, sold 83,700 units at a price of $48 per unit during the current year. Its income statement for the current year is as follows: Sales $4,017,600 Cost of goods sold 1,984,000 Gross profit $2,033,600 Expenses: Selling expenses $992,000 Administrative expenses 992,000 Total expenses 1,984,000 Income from operations $49,600 The division of costs between fixed and variable is as follows: Variable Fixed Cost of goods sold 70% 30% Selling expenses 75% 25% Administrative expenses 50% 50% Management is considering a plant expansion program that will permit an increase of $336,000 in yearly sales. The expansion will increase fixed costs by $33,600, but…
Canoncito Co. produced and sold 6,000 units for $12 per unit. The variable cost was $3 per unit, and the company had net income of $27,000 last year. What is the breakeven point in sales dollars? $54,000 $108,000 $72,000 $36,000 None of the above
Data for XYZ Co.• Expected sales volume: 2,250 units in the first quarter,with 250-unit increases in each succeeding quarter.• Sales price: $50 per unit. What was the total sales for each quarter?
Determine the amount of sales (units) that would be necessary under Break-Even Sales Under Present and Proposed Conditions Darby Company, operating at full capacity, sold 108,000 units at a price of $66 per unit during the current year. Its income statement for the current year is as follows: Sales $7,128,000 Cost of goods sold 3,520,000 Gross profit $3,608,000 Expenses: Selling expenses $1,760,000 Administrative expenses 1,760,000 Total expenses 3,520,000 Income from operations $88,000 The division of costs between fixed and variable is as follows: Variable Fixed Cost of goods sold 70% 30% Selling expenses 75% 25% Administrative expenses 50% 50% Management is considering a plant expansion program that will permit an increase of $594,000 in yearly sales. The expansion will increase fixed costs by $59,400, but will not affect the relationship between sales and variable costs. Required: 1. Determine the…
Required information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Percent of Per Unit Sales Selling price Variable expenses $ 60 100% 39 65 Contribution margin $ 21 35% Fixed expenses are $72,000 per month and the company is selling 4,200 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,600, the monthly sales volume increases by 100 units, and the total monthly sales increase by $6,000? 1-b. Should the advertising budget be increased? Complete this question by entering your answers in the tabs below. Req 1A Req 1B How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,600, the monthly sales volume increases by 100 units, and the total monthly sales increase by $6,000? (Do not round intermediate calculations.) Net operating income decreases by
Required Information [The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Percent Per Unit of sales $95 100% 57 60 $38 40% selling price variable expenses Contribution margin Fixed expenses are $79,000 per month and the company is selling 3,600 units per month. 2-a. Refer to the original data. How much will net operating Income Increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $3 per unit and increase unit sales by 10%. 2-b. Should the higher-quality components be used? Complete this question by entering your answers in the tabs below. Req 2A Req 28 Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher- quality components that increase the variable expense by $3 per unit and increase unit sales by 10%. Net operating income by
Net Income Planning Holland Corporation earned an after-tax net income of $182,000 last year. Fixed costs were $750,000. The selling price per unit of its product was $130, of which $60 was a contribution to fixed cost and net income. The income tax rate was 35%. Round UP answers to the nearest unit, when applicable. a. How many units of product were sold last year? 0 units b. What was the break-even point in units last year? 0 c. The company wishes to increase its after-tax net income by 20% this year. If selling prices and the income tax rate remain unchanged, how many units must be sold? 0 units units
Whirly Corporation's contribution format income statement for the most recent month is shown below: Sales (7,800 units) Variable expenses Contribution margin Fixed expenses Net operating income Total $ 265,200 148, 200 117,000 55,700 $ 61,300 Required: (Consider each case independently): Per Unit $ 34.00 19.00 $15.00 1. What would be the revised net operating income per month if the sales volume increases by 90 units? 1. Revised net operating income 2. Revised net operating income 3. Revised net operating income 2. What would be the revised net operating income per month if the sales volume decreases by 90 units? 3. What would be the revised net operating income per month if the sales volume is 6,800 units?
please answer this with must explanation , computation , for each steps and each parts answer in text form

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