Drew Company manufactures and sells juice drinks in tetra packs of various flavors. Drew set the...

 

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Drew Company manufactures and sells juice drinks in tetra packs of various flavors. Drew set the selling price at P5 per 16-oz pack. For the year 2022, the company estimates the following revenues and expenses. Net sales (1,800,000/5=360,000) Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative P1,800,000 S 1,800,000 5.0 100% 420,000 VC 1,188,000 3.3 66 362,000 CM 612,000 1.7 34 316,000 FC 408,000 283,000 NI 204,000 90,000 125,000 expenses Fixed selling and administrative expenses Required (independent cases, round all answers to whole number): a. What is the degree of operating leverage? b. What is the net income if the sales increase by 45%? c. What is the net income if the sales decrease by 20% d. What is the sales if net income increased by 60%? e. What is the sales if the net income decreased to 100,000? Drew Company manufactures and sells juice drinks in tetra packs of various flavors. Drew set the selling price at P5 per 16-oz pack. For the year 2022, the company estimates the following revenues and expenses. Net sales (1,800,000/5=360,000) Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative P1,800,000 S 1,800,000 5.0 100% 420,000 VC 1,188,000 3.3 66 362,000 CM 612,000 1.7 34 316,000 FC 408,000 283,000 NI 204,000 90,000 125,000 expenses Fixed selling and administrative expenses Required (independent cases, round all answers to whole number): a. What is the degree of operating leverage? b. What is the net income if the sales increase by 45%? c. What is the net income if the sales decrease by 20% d. What is the sales if net income increased by 60%? e. What is the sales if the net income decreased to 100,000? Drew Company manufactures and sells juice drinks in tetra packs of various flavors. Drew set the selling price at P5 per 16-oz pack. For the year 2022, the company estimates the following revenues and expenses. Net sales (1,800,000/5=360,000) Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative P1,800,000 S 1,800,000 5.0 100% 420,000 VC 1,188,000 3.3 66 362,000 CM 612,000 1.7 34 316,000 FC 408,000 283,000 NI 204,000 90,000 125,000 expenses Fixed selling and administrative expenses Required (independent cases, round all answers to whole number): a. What is the degree of operating leverage? b. What is the net income if the sales increase by 45%? c. What is the net income if the sales decrease by 20% d. What is the sales if net income increased by 60%? e. What is the sales if the net income decreased to 100,000? Drew Company manufactures and sells juice drinks in tetra packs of various flavors. Drew set the selling price at P5 per 16-oz pack. For the year 2022, the company estimates the following revenues and expenses. Net sales (1,800,000/5=360,000) Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative P1,800,000 S 1,800,000 5.0 100% 420,000 VC 1,188,000 3.3 66 362,000 CM 612,000 1.7 34 316,000 FC 408,000 283,000 NI 204,000 90,000 125,000 expenses Fixed selling and administrative expenses Required (independent cases, round all answers to whole number): a. What is the degree of operating leverage? b. What is the net income if the sales increase by 45%? c. What is the net income if the sales decrease by 20% d. What is the sales if net income increased by 60%? e. What is the sales if the net income decreased to 100,000?

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Lets calculate the requested values step by step a Degree of Operating Leverage DOL DOL Contribution ... View the full answer