Smith-Pelley Inc produces a single product. The results of the company's operations for a typical month are summarized in contribution format as follows: Sales Less: Variable Expenses Contribution Margin Less: Fixed Expenses Operating Income $540,000 $360,000 $180,000 $120,000 $60,000 The company produced and sold 120,000 kilograms of product during the month. There was no beginning or ending inventories. Required: a) Given the present situation, compute: 1. The break-even sales in kilograms. 2. The break-even sales in dollars. 3. The sales in kilograms that would be required to produce operating income of $90,000. 4. The margin of safety in dollars.

Smith-Pelley Inc produces a single product. The results of the company's operations for a typical month are summarized in contribution format as follows: Sales Less: Variable Expenses Contribution Margin Less: Fixed Expenses Operating Income $540,000 $360,000 $180,000 $120,000 $60,000 The company produced and sold 120,000 kilograms of product during the month. There was no beginning or ending inventories. Required: a) Given the present situation, compute: 1. The break-even sales in kilograms. 2. The break-even sales in dollars. 3. The sales in kilograms that would be required to produce operating income of $90,000. 4. The margin of safety in dollars.

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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In the last reporting period, Global Tech Company recorded 140,000 units sold for the first time in the history of the company. The price per unit was $85.63 and variable costs per unit at $35.07. Compute the contribution margin. Next, compute the fixed costs if the operating income is $3,810,000. OA. $4,909,800; $4,528,800 OB. $7,078,400; $3,268,400 OC. $4,909,800; $5,290,800 OD. $11,988,200; $11,607,200
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)Smith-Pelley Inc produces a single product. The results of the company's operations for a typical month are summarized in contribution format as follows: Sales Less: Variable Expenses Contribution Margin Less: Fixed Expenses Operating Income $540,000 $360,000 $180,000 $120,000 $60,000 The company produced and sold 120,000 kilograms of product during the month. There was no beginning or ending inventories. a) Given the present situation, compute: 1. The Wreak-even sales in kilograms. 2. The break even sales in dollars. ( 3. The sales in kilograms that would be required to produce operating income of $90,000 The margin of safety in dollars b) An important part of processing is performed by a machine that is currently being leased for $20,000 per month. Smith-Pelley has been offered an arrangement whereby it would pay $0.10 royalty per kilogram processed by the machine rather than the monthly lease 1. Should the company choose the lease or the royalty plan? Show all calculations. 2.…
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Hi, I need help inputting the following values (listed below). NOTE: For #4 and #5, round answers to nearest whole dollar amount. Thank you.