The contribution format income statement for Huerra Company for last year is given below: Unit $ 50.10 30.06 Sales Variable expenses Contribution margin Fixed expenses Net operating income Income taxes @ 40% Net income Total $ 1,002,000 601,200 400,800 324,800 76,000 30,400 $ 45,600 20.04 16.24 3.80 1.52 $ 2.28 The company had average operating assets of $492,000 during the year.
The contribution format income statement for Huerra Company for last year is given below: Unit $ 50.10 30.06 Sales Variable expenses Contribution margin Fixed expenses Net operating income Income taxes @ 40% Net income Total $ 1,002,000 601,200 400,800 324,800 76,000 30,400 $ 45,600 20.04 16.24 3.80 1.52 $ 2.28 The company had average operating assets of $492,000 during the year.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The contribution format income statement for Huerra Company for last year is given below:
Unit
$ 50.10
30.06
Sales
Variable expenses
Contribution margin
Fixed expenses
Net operating income
Income taxes @ 40%
Net income
Total
$ 1,002,000
601,200
400,800
324,800
76,000
30,400
$ 45,600
20.04
16.24
3.80
1.52
$ 2.28
The company had average operating assets of $492,000 during the year.
Transcribed Image Text:5. Sales are increased by 10%; operating assets remain unchanged. (Round your answers to 2 decimal places.)
Margin
Turnover
ROI
Margin
Turnover
ROI
%
%
6. Obsolete inventory carried on the books at a cost of $20,000 is scrapped and written off as a loss. (Round your answers to 2 decimal places.)
Margin
Turnover
ROI
%
%
Effect
7. The company uses $184,000 of cash (received on accounts receivable) to repurchase and retire some of its common stock. (Round your answers to 2 decimal places.)
7.58 %
%
Effect
Effect
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