Question: Analyzing change in sales price using the contribution margin ratio Kaito Company reported the following data regarding the one product it sells: Required Use the

Analyzing change in sales price using the contribution margin ratio Kaito Company reported the following data regarding the one product it sells:

Required
Use the equation method and consider each requirement separately.
a. If the sales price is set at $48, how many units must Salazar sell to break even?
b. Salazar estimates that sales will probably be 6,000 units. What sales price per unit will allow the company to break even?
c. Salazar has decided to advertise the product heavily and has set the sales price at $54. If sales are 9,000 units, how much can the company spend on advertising and still break even?

Sales price Contribution margin ratio Fixed costs $16 20% $360,000 per year

Step by Step Solution

★★★★★

3.38 Rating (176 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

a Breakeven Fixed costs Contribution margin ratio Breakeven 360000 ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

67-B-M-A-C-V-P (229).docx

120 KBs Word File

Students Have Also Explored These Related Managerial Accounting Questions!

Analyzing change in sales price using the contribution margin ratio Hugh Company reported the following data regarding the product it sells: Required Use the contribution margin ratio approach and...

Belanov Company reported the following data regarding the one product it sells: Sales price .......... $30 Contribution margin ratio..... 20% Fixed costs .......... $540,000 per year Required Use the...

Kilner Company reported the following data regarding the one product it sells: Sales price ................................... $40 Contribution margin ratio ................ 30% Fixed costs...

Analyzing change in sales price using the contribution margin ratio Bonin Company reported the following data regarding the product it sells. Required Use the contribution margin ratio approach and...

Analyzing change in sales price using the contribution margin ratio Kilner Company reported the following data regarding the one product it sells: Sales price Contribution margin ratio Fixed costs...

Analyzing change in sales price using the contribution margin ratio Kahn Company reported the following data regarding the one product it sells. Required Use the contribution margin ratio approach...

Exercise 3-15A (Static) Multiple product break-even analysis LO 3-6 Riku Company manufactures two products. The budgeted per-unit contribution margin for each product follows: Sales price Variable...

11 Problem 3-18A (Static) Analyzing change in sales price using the contribution margin ratio LO 3-1, 3-2 3 nts Massey Company reported the following data regarding the product it sells: Sales price...

Problem 3-18A (Algo) Analyzing change in sales price using the contribution margin ratio LO 3-1, 3-2 Rundle Company reported the following data regarding the product it sells: Sales price $ 64...

pter 3 Homework Saved Help Save & Exit Submit Check my work Problem 3-18A Analyzing change in sales price using the contribution margin ratio LO 3-1, 3-2 Gibson Company reported the following data...

The legislature in a state has 57 seats. Apportion these seats to the five counties below using Jefferson's method. County Population Seats Received Adams 358,000 Grant 261,000 Colton 286,000 Davis...

Lead! Inc. offers executive coaching services to small business owners. Lead!s operating profits average 20 percent of revenues and its marketing and administrative costs average 25 percent of the...

1. Bob's Beans is a perfectly competitive soybean producer. The short-run price of soybeans is cur- rently below average total cost, but above Bob's shutdown point. A. Using two correctly labeled...

Discuss the concept of concurrent design. What are the advantages of this approach? How would you apply concurrent design to a group project?

A criticism of FASB Statement No. 87 is that it did not require companies to report the funding status of a defined benefit pension plan (overfunded if the plan assets exceed the projected benefit...

Record transactions and adjustments. Prepare an answer sheet with the column headings shown after the following list of transactions. Record the effect, if any, of the transaction entry or adjusting...

The May cash records of Donald Insurance follow: Donald's Cash account shows a balance of $17,750 at May 31. On May 31, Donald Insurance received the following bank statement: Additional data for the...

You find the closing prices for a stock you own. You want to use a 10-day moving average to monitor the stock. Calculate the 10-day moving average for days 11 through 20. Based on the data in the...

A series RC circuit, with R = 10 , has an impedance with an angle of 45 at f 1 = 500 Hz. Find the frequency for which the magnitude of the impedance is (a) Twice that at f 1 , (b) One-half that at f...

Income statements for Gaidar Company for 2014 and 2015 follow. Required Round all percentages to one decimal point. a. Perform a horizontal analysis, showing the percentage change in each income...

Selected financial information for Wilson Company for 2015 follows. Sales ............. $1,600,000 Cost of goods sold ....... 1,000,000 Merchandise inventory Beginning of year ....... 75,000 End of...

Elsea Corporation wrote off an $800 uncollectible account receivable against the $24,000 balance in its allowance account. Required Explain the effect of the write-off on Elseas current ratio.

What are the main optical parameters to characterize the materials

Glacier Co. has not kept pace with the times and is slowly seeing its sales and market share decline. Based on this trend, the firm recently announced that its next annual dividend will be $5.0 a...

Next Page Page 40 Question 4 (1 point) Bond BAA has 14 years to maturity, $1,000 par, 8% coupon rate, semi-annual coupons. What is the percentage change in the price of this bond if the YTM increases...