Sales Beer sales Food sales Other sales Total sales Less cost of sales Gross margin Less marketing and administrative expenses Operating profit of pursuing capital through private investors and financial insti Sales Beer sales (48% of total sales) Food sales (55% of total sales) Other sales (5% of total sales) Total sales Variable Costs Beer (15% of beer sales). Food (35% of food sales) Other (33% of other sales) Wages of employees (25% of sales) Supplies (1% of sales) Utilities (3% of sales) Other: credit card, miscellaneous (2% of sales) Total variable costs Contribution margin Fixed Costs Salaries: manager, chef, brewer Maintenance Advertising Other: cleaning, menus, miscellaneous Insurance and accounting Property taxes Depreciation $ 789,208 1,885,158 98,658 $ 1,973,000 530,738 $1,442,262 1,128,430 $ 313,832 Debt service (interest on debt) Total fixed costs Operating profit $ 789,200 1,885,158 98,650 $ 118,388 379,803 32,555 493,258 19,730 58,898 39,268 $ 135,500 30,200 20,200 48,208 41,000 24,208 95,000 131,000 $ 1,973,000 1,141,868 $ 831,132 517,300 $ 313,832

Sales Beer sales Food sales Other sales Total sales Less cost of sales Gross margin Less marketing and administrative expenses Operating profit of pursuing capital through private investors and financial insti Sales Beer sales (48% of total sales) Food sales (55% of total sales) Other sales (5% of total sales) Total sales Variable Costs Beer (15% of beer sales). Food (35% of food sales) Other (33% of other sales) Wages of employees (25% of sales) Supplies (1% of sales) Utilities (3% of sales) Other: credit card, miscellaneous (2% of sales) Total variable costs Contribution margin Fixed Costs Salaries: manager, chef, brewer Maintenance Advertising Other: cleaning, menus, miscellaneous Insurance and accounting Property taxes Depreciation $ 789,208 1,885,158 98,658 $ 1,973,000 530,738 $1,442,262 1,128,430 $ 313,832 Debt service (interest on debt) Total fixed costs Operating profit $ 789,200 1,885,158 98,650 $ 118,388 379,803 32,555 493,258 19,730 58,898 39,268 $ 135,500 30,200 20,200 48,208 41,000 24,208 95,000 131,000 $ 1,973,000 1,141,868 $ 831,132 517,300 $ 313,832

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Westfall Watches has two product lines: Luxury watches and Sporty watches. Income statement data for the most recent year follow: Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) Total $530,000 375,000 155,000 80,000 $75,000 Select one: O A. Increase $282,500 O B. Increase $362,500 O C. Increase $207,500 O D. Decrease $207,500 Luxury $400,000 255,000 145,000 40,000 $105,000 Sporty $130,000 120,000 10,000 40,000 $(30,000) Assuming the Sporty line is discontinued, total fixed costs remain unchanged, and the space formerly used to produce the Sporty line is used to increase the production of Luxury watches by 250%, how will operating income be affected?
What can you say about the market value of the company? is it positve or is negative?
Please help me
Dog
Sales Variable Costs Fixed Costs Earnings Before Interest and Taxes Interest Expense Earnings Before Taxes Taxes Net Income Additional Data Estimated Pie Sales in Units Price per Pie Variable Cost per Pie Tax Rate Degree of Operating Leverage 60000 36000 20000 4000 3000 1000 350 650 4000 15 0.35
3. income statement for the diff. companies in the same industry are as follows: trimax, inc. quintex, inc. sales p 500,000 p 500,000 less: variable costs 250,000 100,000 contribution margin p 250,000 p 400,000 less: fixed costs 200,000 350,000 operating income p 50,000 p 50,000 required: 1. compute the degree of operating leverage for each company. 2. compute the break-even point for each company. explain why the break-even point for quintex, inc. is higher. 3. suppose that both companies experience a 50 percent increase in revenues. compute the percentage change in profits for each company.
Need Help with this Question
stion Company XYZ produces and sells two types of calculators: Basic and Scientific. The Basic has a lower selling price per unit compared to the Scientific. However, the Basic has a higher contribution margin compared to the Scientific. Due to fixed production capacity, the company has a cap on total production ability. If the company's CEO has decided to shift the sales mix towards producing more Scientific calculators. What red would be the effect on total profits? d out of O a. Total profits would increase g O b. Total profits would decrease on Oc. Total profits would remain the same O d. None of the given answers O e. Cannot be determined using the above information
Chapter: Cost Volume Profit (CVP) Analysis Q) Chaudhary Group Ltd manufactures premium high definition televisions. The firm’s fixed costs are $4,000,000 per year. The variable cost of each TV is $2,000, and the TVs are sold for $3,000 each. The company sold 5,000 TVs during the previous year. (In the following requirements, ignore income taxes) Required: Treat each of the requirements as independent situations:a) Calculate the break-even point in units. b) What will the new break-even point be if fixed costs increase by 10 per cent? c) What was the company’s net profit for the previous year? d) The sales manager believes that a reduction in the sales price to $2,500 will result in orders for 1,200 more TVs each year. What will the break-even point be if the price is changed?
Operating leverage Beck Inc. and Bryant Inc.have the following operating data: Beck Inc. Bryant Inc. Sales $1,250,000 $2,000,000 Variable costs 750,000 1,250,000 Contribution margin $500,000 $ 750,000 Fixed costs 400,000 450,000 Income from operations $ 100,000 $300,000 a.Compute the operating leverage for Beck Inc.and Bryant Inc. b.How much would income from operations increase for each company if the sales of each increased by 20%? c.Why is there a difference in the increase in income from operations for the two companies? Explain.
Based on the income statements shown below, which division has the cost structure with the highest operating leverage? Soft Drinks $ 64,000 Bottled Water Fruit Juices $ 64,000 $ 64,000 (16,000) (8,000) (36,000) 一開 48,000 28,000 (10,080) $ 17,920 Revenue Variable costs Contribution margin Fixed costs Net income Multiple Choice Bottled Water. Fruit Juices. Soft Drinks. (37,920) $ 10,080 The three divisions have identical operating leverage. 56,000 (47,920) $ 8,080
Finance Given below is the financial information for Tesla, a uniquely French all-natural artisanal soda. Sales (Units) - 4 00 000 Selling Price (per unit) - Rs 32 Fixed Cost - 450000 Variable Cost(per unit) - 24 Debt - 1000000 Interest Rate -12% Based on the information answer the following: A. What is the Degree of Operating Leverage for the firm? What are its implications for firm's financial decision-making? B. HoW much would the firm's sales have to come down so that its EBT is equal to zero?