Twenty Twenty One Corp.Income StatementFor the month ended December 31, 2020Sales (P10/unit) 900,000Beginning Inventory125,000 Variable Cost of Goods Manufactured400,000 Total Goods Available for Sale525,000 Ending Inventory75,000 Variable Cost of Goods Sold450,000 Variable Selling Expense90,000540,000Contribution Margin 360,000Manufacturing240,000 Selling and Administrative90,000330,000Operating Profit 30,000During December 2020, the entity manufactured a total of 80,000 unitsRequired: Assuming the entity raises its unit sales by 15%, how much would be the expected increase in the profit before tax?

Variable cost means the cost which vary with the level of output where as fixed cost remain fixed…

Answered: Twenty Twenty One Corp. Income…

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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Twenty Twenty One Corp.
Income Statement
For the month ended December 31, 2020

Sales (P10/unit)		900,000
Beginning Inventory	125,000
Variable Cost of Goods Manufactured	400,000
Total Goods Available for Sale	525,000
Ending Inventory	75,000
Variable Cost of Goods Sold	450,000
Variable Selling Expense	90,000	540,000
Contribution Margin		360,000
Manufacturing	240,000
Selling and Administrative	90,000	330,000
Operating Profit		30,000

During December 2020, the entity manufactured a total of 80,000 units

Required: Assuming the entity raises its unit sales by 15%, how much would be the expected increase in the profit before tax?

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