The W.V Scott Company had sales last year of $600,000, a NOI of $20,000 and DOL of
Question:
The W.V Scott Company had sales last year of $600,000, a NOI of $20,000 and DOL of 4. Assume that fixed costs are the same this year as last year.
(i) Suppose that next year's sales are $630,000. What will next year's NOI be?
(ii) Suppose that next year's sales are $550,000. What will next year's NOI be?
(iii) Next year's NOI is $25,000. What must sales be for that year?
Top pops manufactures plaid vinyl and cartops for convertibles. These roofs sells for $200 each and have an associated variable cost per unit of $120. Management fully expects next year's sales and NOI to drop sharply, by 20% and 50%, respectively due to a lack of demand. If Top pops current level of production and sales is 112 cartops, what is its level of fixed costs?
Expert Answer:
i To find next years NOI when sales are 630000 DOL change in NOI change in sales 4 change in NOI 005 ... View the full answer
Cornerstones of Financial and Managerial Accounting
ISBN: 978-1111879044
2nd edition
Authors: Rich, Jeff Jones, Dan Heitger, Maryanne Mowen, Don Hansen
