Express Delivery is a rapidly growing delivery service. Last year, 80% of its revenue came from...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Express Delivery is a rapidly growing delivery service. Last year, 80% of its revenue came from the delivery of mailing "pouches" and small, standardized delivery boxes (which provides a 20% contribution margin). The other 20% of its revenue came from delivering non-standardized boxes (which provides a 70% contribution margin). With the rapid growth of Internet retail sales, Express believes that there are great opportunities for growth in the delivery of non-standardized boxes. The company has fixed costs of $12,120,000. (a) What is the company's break-even point in total sales dollars? At the break-even point, how much of the company's sales are provided by each type of service? (Use Weighted-Average Contribution Margin Ratio rounded to 2 decimal places e.g. 0.22 and round final answers to O decimal places, e.g. 2,510.) Total break-even sales 43290000 Sale of mail pouches and small boxes 34632000 Sale of non-standard boxes 8658000 (b) The company's management would like to hold its fixed costs constant but shift its sales mix so that 60% of its revenue comes from the delivery of non-standardized boxes and the remainder from pouches and small boxes. If this were to occur, what would be the company's break-even sales, and what amount of sales would be provided by each service type? (Use Weighted-Average Contribution Margin Ratio rounded to 2 decimal places eg. 0.22 and round final answers to 0 decimal places, eg. 2,510.) Total break-even sales 25974000 Sale of mail pouches and small boxes 10389600 Sale of non-standardized boxes 15584400 %24 %24 %24 %24 %24 Express Delivery is a rapidly growing delivery service. Last year, 80% of its revenue came from the delivery of mailing "pouches" and small, standardized delivery boxes (which provides a 20% contribution margin). The other 20% of its revenue came from delivering non-standardized boxes (which provides a 70% contribution margin). With the rapid growth of Internet retail sales, Express believes that there are great opportunities for growth in the delivery of non-standardized boxes. The company has fixed costs of $12,120,000. (a) What is the company's break-even point in total sales dollars? At the break-even point, how much of the company's sales are provided by each type of service? (Use Weighted-Average Contribution Margin Ratio rounded to 2 decimal places e.g. 0.22 and round final answers to O decimal places, e.g. 2,510.) Total break-even sales 43290000 Sale of mail pouches and small boxes 34632000 Sale of non-standard boxes 8658000 (b) The company's management would like to hold its fixed costs constant but shift its sales mix so that 60% of its revenue comes from the delivery of non-standardized boxes and the remainder from pouches and small boxes. If this were to occur, what would be the company's break-even sales, and what amount of sales would be provided by each service type? (Use Weighted-Average Contribution Margin Ratio rounded to 2 decimal places eg. 0.22 and round final answers to 0 decimal places, eg. 2,510.) Total break-even sales 25974000 Sale of mail pouches and small boxes 10389600 Sale of non-standardized boxes 15584400 %24 %24 %24 %24 %24
Expert Answer:
Answer rating: 100% (QA)
a Weighted average contribution margin 8020 2070 30 Total break even salesFixed costsCM ... View the full answer
Related Book For
Accounting Tools for business decision making
ISBN: 978-0470095461
4th Edition
Authors: kimmel, weygandt, kieso
Posted Date:
Students also viewed these accounting questions
-
Express Delivery is a rapidly growing delivery service. Last year, 80% of its revenue came from the delivery of mailing pouches and small, standardized delivery boxes (which provides a 20%...
-
Express Delivery is a rapidly growing delivery service. Last year, 83% of its revenue came from the delivery of mailing "pouches" and small, standardized delivery boxes (which provides a 13%...
-
A T-shirt company has fixed costs of $25,000 per year. Each T-shirt costs $8.00 to produce and sells for $12.50. How many T-shirts must the company produce and sell each year in order to make a...
-
Find the minimum and maximum values of the function subject to the given constraint. f (x, y) = x + y, x + y4 = 1
-
A quality-control manager found that 30% of work-related problems occurred on Mondays and that 20% occurred in the last hour of a day's shift. It was also found that 4% of worker-related problems...
-
Name a C compiler feature that could eliminate a large number of security holes. Why is it not more widely implemented?
-
Visit the website www.nielsen.com and choose one of the reports published. Write a brief analysis of the findings and solutions presented by the report.
-
Loco Leasing and Manufacturing Company uses leases as a means of financing sales of its equipment. Loco leased a machine to Potomac Construction for $15,000 per year, payable in advance, for a...
-
Last year Minden Company introduced a new product and sold 2 5 , 1 0 0 units of it at a price of $ 9 9 per unit. The product's variable expenses are $ 6 9 per unit and its fixed expenses are $ 8 3 0...
-
Required Identify and discuss any professional conduct issues in the following independent scenarios. (a) Adnan is a certified general accountant working for a national firm. He is at his desk when...
-
1. Let X, Poisson(A,), for i = 1,2. (a) Show that X1 + X2~ Poisson(A1 + A2). (b) Show that X1| X1 + X2 is binomial with probability of success equal to (c) What is the distribution of X2 X1+ X2?
-
As a citizen of the United States, I believe that national security and defense should always be a concern and priority. Thus, all exporters that wish to export to a hostile country of the United...
-
Question 3 Single-period Inventory Control for Continuous Distribution Demand (4 marks) A newsagent sells ' The Daily Business Bulletin' for $5.50 per copy. The bulletins are purchased from a...
-
For each of the following, calculate the perimeter and area of the largest figure. Simplify your answers if possible. All four-sided figures are rectangles. a. S X y 12 b. X 6
-
What is one strategic reason for Facebook's battle for control of the new online world? Describe one of the competitive advantages of Facebook as mentioned in the case. What is one of the potential...
-
Compute the utilisation and efficiency rates for the following scenario: A manufacturer makes chairs for a local market. The total facility rental costs are $3000 per month, and the variable costs...
-
is a traditional function of the MIS department. O Providing technical services O Educating the MIS staff about the business O Initiating and designing specific strategic IS Proactively using...
-
Reichenbach Co., organized in 2018, has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded during 2018 and 2019. Instructions...
-
For each account listed here, indicate whether it generally will have debit entries only, credit entries only, or both debit and credit entries. (a) Cash. (b) Accounts Receivable. (c) Dividends. (d)...
-
During January, its first month of operations, Knox Tool & Die accumulated the following manufacturing costs: raw materials $4,000 on account, factory labor $6,000 of which $5,200 relates to factory...
-
Here are comparative statement data for Martin Company and Lewis Company, two competitors. All balance sheet data are as of December 31, 2012, and December 31, 2011. Instructions(a) Prepare a...
-
a. For the allowed energies of a particle in a box to be large, should the box be very big or very small? Explain. b. Which is likely to have larger values for the allowed energies: an atom in a...
-
The molecules in the rods and cones in the eye are tuned to absorb photons of particular energies. The retinal molecule, like many molecules, is a long chain. Electrons can freely move along one...
-
What was the approximate activity of the plutonium source at the start of the mission? A. \(2 \times 10^{21} \mathrm{~Bq}\) B. \(2 \times 10^{19} \mathrm{~Bq}\) C. \(2 \times 10^{17} \mathrm{~Bq}\)...
Study smarter with the SolutionInn App