The following date relates to Your Company:TotalStore 1Store 2Sales$2,100,000$1,300,000$800,000VC$1,065,000$585,000$480,000CM$1,035,000$715,000$320,000Traceable fixed costs$497,500$165,000$332,500Segment margin$537,500$550,000($12,500)Common fixed costs$370,000$210,000$160,000$167,500$340,000($172,500)NIYour Company is considering closing Store 2. If Store 2 is closed, 65% of its traceable fixed expenses could beavoided. Also, the closing of Store 2 would result in a 15% increase in sales in Store 1. Your Company allocatescommon fixed expenses on the basis of sales dollars and none of these costs would be saved if a store were shutdown. What is the increase or (decrease) in the net income if Store I is closed?Enter an increase as a positive number and a decrease wtih a minus sign in front.

Shut down analysis refers to analyzing the decision of shutting down the division/product of the…

The following date relates to Your Company: Total Store 1 Store 2 Sales $2,100,000 $1,300,000 $800,000 VC $1,065,000 $585,000 $480,000 СМ $1,035,000 $715,000 $320,000 Traceable fixed costs $497,500 $165,000 $332,500 Segment margin $537,500 $550,000 ($12,500) Common fixed costs $370,000 $210,000 $160,000 $167,500 $340,000 ($172,500) NI Your Company is considering closing Store 2. If Store 2 is closed, 65% of its traceable fixed avoided. Also, the closing of Store 2 would result in a 15% increase in sales in Store 1. Your Company alloc- common fixed expenses on the basis of sales dollars and none of these costs would be saved if a store were s down. What is the increase or (decrease) in the net income if Store I is closed? expenses could

The following date relates to Your Company: Total Store 1 Store 2 Sales $2,100,000 $1,300,000 $800,000 VC $1,065,000 $585,000 $480,000 СМ $1,035,000 $715,000 $320,000 Traceable fixed costs $497,500 $165,000 $332,500 Segment margin $537,500 $550,000 ($12,500) Common fixed costs $370,000 $210,000 $160,000 $167,500 $340,000 ($172,500) NI Your Company is considering closing Store 2. If Store 2 is closed, 65% of its traceable fixed avoided. Also, the closing of Store 2 would result in a 15% increase in sales in Store 1. Your Company alloc- common fixed expenses on the basis of sales dollars and none of these costs would be saved if a store were s down. What is the increase or (decrease) in the net income if Store I is closed? expenses could

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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90 Marston Corporation Statement of Income for the Year Ending December 31, 2022 Using Sales Agents Using Own Sales Force $26,000,000 Sales Cost of goods sold Variable Fixed Gross margin Marketing costs Commissions Fixed costs Operating income $11,700,000 2,870,000 4,680,000 3,420,000 $26,000,000 14,570,000 11,430,000 8,100,000 $ 3,330,000 $11,700,000 2,870,000 2,600,000 5,500,000 14,570,000 11,430,000 8,100,000 $ 3,330,000 Marston is considering hiring its own sales staff to replace the network of agents. Marston will pay its salespeople a commission of 10% and incur additional fixed costs of $2,080,000. 4 Required 1. Calculate Marston Corporation's 2022 contribution margin percentage, breakeven revenues, and degree of operating leverage under each of the two scenarios. (You will first have to recast the 2022 statement of income assuming Marston had hired its own sales staff.) 2. Describe the advantages and disadvantages of each type of sales alternative. 3. In 2023, Marston uses its…
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Question Completion Status: QUESTION 7 Using the following information, calculate the monthly net profit Sales for the month Food costs 73,904 25% of Sales Labor costs 45% of Sales Rent and Insurance $1500/month Supplies $2217/month Other expenses $3791/month OA. $51,733 O B. $22,171 O C. $7508 OD. $14,663 QUESTION 8 Calculate the profit margin from the last problem O A. 17.5% OB. 19.84% OC. 18.29% Click Save and Submit to save and submit. Click Save All Answers to save all answers OD.22.22%
Sales VC Complete the shaded cells below: Year 1 $32,960,000 13,440,000 Year 2 Year 3 Year 4 $54,590,000 22,260,000 $44,805,000 18,270,000 $40,170,000 Year 5 $27,810,000 16,380,000 11,340,000 Fixed costs 5,300,000 5,300,000 5,300,000 5,300,000 5,300,000 Dep EBT 5,501,650 $8,718,350 9,428,650 6,733,650 4,808,650 3,438,050 $17,601,350 $14,501,350 $13,681,350 $7,731,950 Tax NI $6,800,313 +Dep OCF 1,918,037 5,501,650 $12,301,963 3,872,297 $13,729,053 5,501,650 $19,230,703 3,190,297 3,009,897 1,701,029 $11,311,053 $10,671,453 $6,030,921 5,501,650 $16,812,703 5,501,650 $16,173,103 5,501,650 $11,532,571 NWC Beg End $0 0 NWC CF $6,592,000 $10,918,000 $8,961,000 $8,034,000 $5,562,000 Net CF Salvage BV of equipment Taxes Salvage CF Net CF Time 0 2 3 5 12345
Ron Company has the following commission schedule: Commission rate Sales 2% Up to $80, 000 Excess of $80,000 to $100,000 More than $100,000 3.5% 4% Calculate the gross earning. Employee Total sales Gross earning Lai Xiaodong %24 146,000 < Prev 6 of 16 Next ..... .....n .....
Mairy Productions has three models: D, E, and F. The following information is available Model D 100.000 $37,000 $32,000 $20.000 $12,000 Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) Model E $37,000 $14,000 $23.000 $20,000 $3,000 A. Increase $13,000 OB. Decrease $13,000 OC. Increase $18,000 OD. Decrease $18,000 Model F $24,000 $14.000 $10,000 $20,000 ($10,000) Maizy Productions is thinking of discontinuing model F because it is reporting an operating loss. All fixed costs are unavoidable. Assuming Maizy Productions discontinues fine F and is able to double the production and sales of model E without increasing fixed costs. What effect will this have on operating income?
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