Question: Exercise 6-4 Computing and Using the CM Ratio [LO6-3] Last month when Holiday Creations, Inc., sold 41,000 units, total sales were $301,000, total variable expenses

Exercise 6-4 Computing and Using the CM Ratio [LO6-3]

Last month when Holiday Creations, Inc., sold 41,000 units, total sales were $301,000, total variable expenses were $252,840, and fixed expenses were $35,900.

Required:

1. What is the companys contribution margin (CM) ratio?

2. What is the estimated change in the companys net operating income if it can increase total sales by $2,900? (Do not round intermediate calculations.)

1	Contribution margin ratio		%
2	Estimated change in net operating income		%

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

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

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

y Exercise 6-4 Computing and Using the CM Ratio [LO6-3] Last month when Holiday Creations, Inc., sold 42,000 units, total sales were $283,000, total variable expenses were $206,590, and fixed...

Homework Saved Exercise 6-4 Computing and using the CM Ratio (LO6-3) Last month when Holiday Creations, Inc., sold 45,000 units, total sales were $287,000, total variable expenses were $218,120, and...

Exercise 6-4 Computing and Using the CM Ratio [LO6-3] Last month when Holiday Creations, Inc., sold 50,000 units, total sales were $200,000, total variable expenses were $120,000, and fixed expenses...

Exercise 6-4 Computing and using the CM Ratio (LO6-3] Last month when Holiday Creations, Inc., sold 43,000 units, total sales were $302,000, total variable expenses were $229,520, and fixed expenses...

Exercise 6-4 Computing and using the CM Ratio (LO6-3) Last month when Holiday Creations, Inc., sold 45,000 units, total sales were $285,000, total variable expenses were $228,000, and fixed expenses...

Exercise 6-4 Computing and using the CM Ratio (LO6-3) Last month when Holiday Creations, Inc., sold 38,000 units, total sales were $301,000, total variable expenses were $255,850, and fixed expenses...

Exercise 6-4 Computing and Using the CM Ratio (LO6-3) Last month when Holiday Creations, Inc., sold 42,000 units, total sales were $281000, total variable expenses were 5202, 320, and fixed expenses...

Exercise 6-4 Computing and Using the CM Ratio (LO6-3) Last month when Holiday Creations, Inc., sold 42,000 units, total sales were $296,000, total variable expenses were $245,680, and fixed expenses...

Exercise 6-4 Computing and Using the CM Ratio [LO6-3] Last month when Holiday Creations, Inc., sold 42,000 units, total sales were $297,000, total variable expenses were $207,900, and fixed expenses...

Exercise 6-4 Computing and Using the CM Ratio [LO6-3] Last month when Holiday Creations, Inc., sold 35,000 units, total sales were $301,000, total variable expenses were $222,740, and fixed expenses...

Anderson Steel Company began 2013 with 600,000 shares of common stock outstanding. On March 31, 2013, 100,000 new shares were sold at a price of $45 per share. The market price has risen steadily...

(a) Show that the fundamental period Np of the signals s k (n) = e j2kn/N . k = 0. 1. 2. . . . is given by Np = N/GCD(K,N), where GCD is the greatest common divisor of k and N. (b) What is the...

Which of the following best defines a variable cost? A cost that changes inversely with the level of production A cost that includes both fixed and variable components A cost that remains constant in...

Describe the six steps in the marketing research process. why is step 1 ( defining the problem and objective ) the most crucial stage in the market research process? what are the major stages in teh...

Describe strategic succession planning in todays environment.

Explain the various elements of a diverse workforce.

Describe the strategic planning process.