Assignment (1) The following is Mostafa Corporation's contribution format income statement: Sales (-) TVC 1,200,000 (800,000)...

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Assignment (1) The following is Mostafa Corporation's contribution format income statement: Sales (-) TVC 1,200,000 (800,000) TCM 400,000 (-) TFC (300,000) NOI 100,000 The company has no beginning or ending inventories and produced and sold 20,000 units during the month. Required: 1. What is the company's contribution margin ratio? 2. What is the company's break-even in units? 3. If sales increase by 100 units, by how much should net operating income increase? 4. How many units would the company have to sell to attain target profits of $125,000? 5. What is the company's margin of safety in dollars? 6. If sales next year is expected to be $1,500,000. How much will be net income? 7. What is the company's degree of operating leverage? Assignment (1) The following is Mostafa Corporation's contribution format income statement: Sales (-) TVC 1,200,000 (800,000) TCM 400,000 (-) TFC (300,000) NOI 100,000 The company has no beginning or ending inventories and produced and sold 20,000 units during the month. Required: 1. What is the company's contribution margin ratio? 2. What is the company's break-even in units? 3. If sales increase by 100 units, by how much should net operating income increase? 4. How many units would the company have to sell to attain target profits of $125,000? 5. What is the company's margin of safety in dollars? 6. If sales next year is expected to be $1,500,000. How much will be net income? 7. What is the company's degree of operating leverage?

Answer rating: 100% (QA)

1 The contribution margin ratio is calculated as follows Contribution Margin Sales Variable Costs Co... View the full answer