Swift Enterprises has sales of $500,000, variable costs are 70% of sales, and operating income is $75,000. What is the operating leverage? a. O b. 1.5 c. 2.33 d. 2
Q: I don't need ai answer general accounting question
A: Step 1: Definition of Predetermined Overhead RateThe predetermined overhead rate is calculated at…
Q: MCQ
A: The Debt to Equity Ratio is calculated using the formula:Debt to Equity Ratio=Total Debt/Total…
Q: Amount would the company record the land
A: Step 1: Definition of Fixed Asset AllocationWhen a company purchases multiple fixed assets as a lump…
Q: Do fast answer of this general accounting question
A: Step 1:Ratio analysis is a method of compression of financial data with previous years or with other…
Q: Please given correct answer general accounting question
A: Step 1: Define Margin and Asset TurnoverMargin: Margin is a measure of profitability and shows what…
Q: Michael is a 40% partner in the Juno Partnership. At the beginning of the tax year, Michael's basis…
A: Explanation of Partnership Basis:Partnership basis represents a partner's investment in the…
Q: What is falcon enterprise price earnings ratio?? Help me please
A: To calculate Falcon Enterprises' price-earnings (P/E) ratio, we use the formula:P/E Ratio=Earnings…
Q: Want answer
A: Question 1: Overhead Applied Calculation Bright Orange, Inc. uses direct labor hours to allocate…
Q: MCQ
A: The Debt-to-Equity Ratio is calculated as: Debt-to-Equity Ratio=Total EquityTotal Debt Given:…
Q: Jinkal Sports Co. sells a product for $55 per unit. The variable cost per unit is $28, and monthly…
A: ReferencesGarrison, R. H., Noreen, E. W., & Brewer, P. C. (2021). Managerial Accounting (17th…
Q: What is the operating profit?
A: Explanation of Contribution Margin:Contribution Margin represents the portion of sales revenue that…
Q: what is the direct labor efficiency variance?
A: Step 1: Definition of Direct Labor Efficiency VarianceThe Direct Labor Efficiency Variance measures…
Q: Accounting 8.9
A: Step 1: The determination of the predetermined overhead rate:- Predetermined overhead rate =…
Q: Get correct answer general accounting question
A: Step 1: Definition of Tax LiabilityTax liability is the total amount of taxes owed to the…
Q: Hello tutor please provide this question solution general accounting
A: Step 1: Definition of TurnoverTurnover, in the context of Return on Investment (ROI), refers to the…
Q: Everest Manufacturing produces and sells a single product. The company has provided its contribution…
A: Step 1: Definition of Contribution MarginThe Contribution Margin (CM) is the amount remaining after…
Q: Provide correct answer general accounting question
A: Step 1: Define Variable Maintenance CostVariable maintenance costs are expenses that change in…
Q: Using the high-low method, estimate a cost formula for power cost. ??
A: Step 1: Definition of High-Low MethodThe high-low method is a cost estimation technique used to…
Q: Quick answer of this accounting questions
A: Step 1: Definition of Gross Profit PercentageGross profit percentage, also known as gross profit…
Q: Answer this Question
A: Recall the ROA Formula Return on Assets (ROA) is calculated as: ROA=Average Total AssetsNet…
Q: provide correct answer is accounting
A: Step 1: Definition of Equity MultiplierThe Equity Multiplier is a financial leverage ratio that…
Q: Step by step solution
A: Step 1: DefinitionsDynamic Pricing - Dynamic pricing is a strategy where businesses adjust prices…
Q: Acp Distributors purchased a Cooling System
A: Concept of DepreciationDepreciation is the systematic allocation of an asset's cost over its useful…
Q: Want Answer
A: we use the Price-to-Earnings (P/E) ratio formula:P/E Ratio = Market Price per Share ÷ Earnings per…
Q: Gama Co. sold merchandise to Harper Co. on account for $50,000, with terms of 3/10, net 60. The cost…
A: Explanation of Sales Revenue:Sales revenue is the total income a business generates from selling…
Q: Compute total manufacturing costs for this accounting question
A: Step 1: Define Total Manufacturing CostsTotal Manufacturing Costs refer to the sum of direct…
Q: During a specific period, Nexus Technologies reported a decrease in total assets of $14,500 and an…
A: Step 1:Change in Liabilities can be calculated using the formula stating the relation of assets,…
Q: What amount accounts receivable be reported on the balance sheet
A: Explanation of Gross Accounts Receivable:Gross accounts receivable represents the total amount of…
Q: Subject: financial accounting
A: Step 1: Definitions The Cash Conversion Cycle (CCC) measures the time it takes for a company to…
Q: Newcombe & Associates, Inc. is considering the introduction of a new product. Production of the new…
A:
Q: What is its net income?
A: given the following data:Sales (Revenue) = $12 millionReturn on Equity (ROE) = 12% (0.12)Total Asset…
Q: not use ai solution give answer of this General accounting question
A: Step 1: Define Cash Collected from CustomersCash collected from customers represents the actual cash…
Q: Subject: financial accounting 2
A: Explanation of Shares Outstanding: Shares outstanding represent the total number of shares of a…
Q: At the end of the first year, Swift Electronics had net accounts receivable of $80,500. At the end…
A: Step 1: Definition of Receivable Turnover RatioThe Receivable Turnover Ratio measures how…
Q: value of the total assets account subjects
A: Step 1: Definition of Total AssetsTotal assets represent all the resources owned by a business,…
Q: Subject:-- general accounting
A: Step 1: Definition of Overhead CostsOverhead costs refer to the indirect costs involved in…
Q: Accurate Answer
A: Concept of Contribution MarginThe Contribution Margin represents the amount remaining from sales…
Q: Accurate Answer
A: Return on Assets (ROA) is calculated using the formula:ROA=Average Total AssetsNet Income×100…
Q: Kindly help me with accounting questions
A: Step 1: Definition of Return on Equity (ROE) Using the DuPont IdentityThe DuPont Identity is a…
Q: Solution
A: To find the gross profit margin, we'll first calculate the gross profit:Gross Profit = Sales - Cost…
Q: Subject:-- financial accounting
A: Step 1: Definition of Cost-Volume-Profit (CVP) AnalysisThe CVP analysis is handy in figuring out the…
Q: hi expert please help me
A: Step 1: Definition of Owners' EquityA balance sheet is a financial statement that shows the sources…
Q: Actual return on plan assets for
A: The actual return on plan assets can be calculated as follows:Actual Return=Expected…
Q: Solve this Accounting Problem
A: Explanation: In the given case, we are provided with the beginning balance of owners' equity along…
Q: do fast answer of this General accounting question
A: Step 1: Definition of Net IncomeNet income is the amount of earnings remaining after deducting…
Q: Mit Distributors provided the following inventory-related data for the fiscal year: Purchases:…
A: Step 1: Definition of Cost of Goods Sold (COGS)Cost of Goods Sold (COGS) represents the direct costs…
Q: What is its standard manufacturing overhead rate per unit of this general accounting question?
A: Step 1: Definition of Standard Manufacturing Overhead RateThe standard manufacturing overhead rate…
Q: please provide answer general accounting question
A: Step 1: Definition of Target Selling PriceThe target selling price is the price at which a company…
Q: At Baxter Company, as of June 30, the company has net sales of $400,000 and a cost of goods…
A: Concept of Gross ProfitGross profit is the difference between net sales and the cost of goods sold,…
Q: materials price variance for part XBEZ52 was.
A: Step 1: Definition of Materials Price VarianceStandard cost is defined as the amount that a company…
Operating leverage?
Step by step
Solved in 2 steps
- If a firm has a contribution margin of $78M90 and a net income of $13,700 for the current month, what is their degree of operating leverage? 0.21 1.21 2.4 5.7If a firm has a contribution margin of $59,690 and a net income of $12,700 for the current month, what is their degree of operating leverage? A. 0.18 B. 1.18 C. 2.4 D. 4.7Company A has current sales of $10,000,000 and a 45% contribution margin. Its fixed costs are $3,000,000. Company B is a service firm with current service revenue of $5,000,000 and a 20% contribution margin. Company Bs fixed costs are $500,000. Compute the degree of operating leverage for both companies. Which company will benefit most from a 25% increase in sales? Explain why.
- Suppose you are analyzing a firm that is successfully executing a strategy that differentiates its products from those of its competitors. Because of this strategy, you project that next year the firm will generate 6.0% revenue growth from price increases and 3.0% revenue growth from sales volume increases. Assume that the firms production cost structure involves strictly variable costs. (That is, the cost to produce each unit of product remains the same.) Should you project that the firms gross profit will increase next year? If you project that the gross profit will increase, is the increase a result of volume growth, price growth, or both? Should you project that the firms gross profit margin (gross profit divided by sales) will increase next year? If you project that the gross profit margin will increase, is the increase a result of volume growth, price growth, or both?Fire Company is a service firm with current service revenue of $900,000 and a 40% contribution margin. Its fixed costs are $200,000. Ice Company has current sales of $420,000 and a 30% contribution margin. Its fixed costs are $90,000. What is the margin of safety for Fire and Ice? Compare the margin of safety in dollars between the two companies. Which is stronger? Compare the margin of safety in percentage between the two companies. Now which one is stronger? Compute the degree of operating leverage for both companies. Which company will benefit most from a 10% increase in sales? Explain why. Illustrate your findings in an Income Statement that is increased by 10%.Profit margin, investment turnover, and ROI Briggs Company has operating income of 36,000, invested assets of 180,000, and sales of 720,000. Use the DuPont formula to compute the return on investment and show (A) the profit margin, (B) the investment turnover, and (C) the return on investment.
- Contribution Margin Ratio, Break-Even Sales, Operating Leverage Elgart Company produces plastic mailboxes. The projected income statement for the coming year follows: Required: 1. Compute the contribution margin ratio for the mailboxes. 2. How much revenue must Elgart earn in order to break even? 3. What is the effect on the contribution margin ratio if the unit selling price and unit variable cost each increase by 15%? 4. CONCEPTUAL CONNECTION Suppose that management has decided to give a 4% commission on all sales. The projected income statement does not reflect this commission. Recompute the contribution margin ratio, assuming that the commission will be paid. What effect does this have on the break-even point? 5. CONCEPTUAL CONNECTION If the commission is paid as described in Requirement 4, management expects sales revenues to increase by 80,000. How will this affect operating leverage? Is it a sound decision to implement the commission? Support your answer with appropriate computations.Division A of Kern Co. has sales of $350,000, cost of goods sold of $200,000, operating expenses of $30,000, and invested assets of $600000. What is the return on investment for Division A? A. 20% B. 25% C. 33% D. 40%Jakarta Company is a service firm with current service revenue of $400,000 and a 40% contribution margin. Its fixed costs are $80,000. Maldives Company has current sales of $6,610,000 and a 45% contribution margin. Its fixed costs are $1,800,000. What is the margin of safety for jaka rta and Maldives? Compare the margin of safety in dollars between the two companies. Which is stronger? Compare the margin of safety in percentage between the two companies. Now, which one is stronger? Compute the degree of operating leverage for both companies. Which company will benefit most from a 15% increase in sales? Explain why. Illustrate your findings in an Income Statement that is increased by 15%.
- Suppose a firm with a contribution margin ratio of 0.3 increased its advertising expenses by 10,000 and found that sales increased by 30,000. Was it a good decision to increase advertising expenses? Why is this simple problem an important one for businesspeople to understand?Wallace Industries has total contribution margin of $58,560 and net income of $24,400 for the month of April. Wallace expects sales volume to increase by 5% in May. What are the degree of operating leverage and the expected percent change in income for Wallace Industries? 0.42 and 2.2% 0.42and5% 2.4andl2% 2.Sandl3%Contribution margin Waite Company sells 250,000 units at 120 per unit. Variable costs are 78 per unit, and fixed costs are 8,175,000. Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) operating income.
