Green Productions performs London shows. The average show sells 1,095 tickets at $45 per ticket. There...
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Green Productions performs London shows. The average show sells 1,095 tickets at $45 per ticket. There are 180 shows per year. No additional shows can be held as the theater is also used by other production companies. The average show has a cast of 60, each earning a net average of $240 per show. The cast is paid after each show. The other variable cost is a program-printing cost of $10 per guest. Annual fixed costs total $334,950. Read the requirements. Begin by showing the formula and then entering the amounts to calculate the required sales dollars to earn a profit of $4,350,000. (Round the required sales in dollars to the nearest whole dollar. Round amounts in the formula to two decimal places, XX.XX. Abbreviation used: CM = contribution margin.) ( Fixed costs 334950 + Target profit) CM ratio 4350000 = Required sales in dollars 48.55 % 9648941 Now use the information given and the required sales in dollars computed in the previous step to determine the required number of shows needed each year to earn a profit of $4,350,000. (Round your answer up to the nearest whole number.) The number of shows needed annually to earn a profit of $4,350,000 is 196 Is this profit goal realistic? Give your reasoning. The profit goal of $4,350,000 is unrealistic since Green Productions currently performs 180 shows a year. Requirement 4. Prepare Green Productions' contribution margin income statement for 180 shows performed in the year. Report only two categories of costs: variable and fixed. Green Productions Contribution Margin Income Statement Year Ended December 31, 20XX Sales Revenue Variable Costs Contribution Margin Fixed Costs Operating Income (Loss) 88 Green Productions performs London shows. The average show sells 1,095 tickets at $45 per ticket. There are 180 shows per year. No additional shows can be held as the theater is also used by other production companies. The average show has a cast of 60, each earning a net average of $240 per show. The cast is paid after each show. The other variable cost is a program-printing cost of $10 per guest. Annual fixed costs total $334,950. Read the requirements. Begin by showing the formula and then entering the amounts to calculate the required sales dollars to earn a profit of $4,350,000. (Round the required sales in dollars to the nearest whole dollar. Round amounts in the formula to two decimal places, XX.XX. Abbreviation used: CM = contribution margin.) ( Fixed costs 334950 + Target profit) CM ratio 4350000 = Required sales in dollars 48.55 % 9648941 Now use the information given and the required sales in dollars computed in the previous step to determine the required number of shows needed each year to earn a profit of $4,350,000. (Round your answer up to the nearest whole number.) The number of shows needed annually to earn a profit of $4,350,000 is 196 Is this profit goal realistic? Give your reasoning. The profit goal of $4,350,000 is unrealistic since Green Productions currently performs 180 shows a year. Requirement 4. Prepare Green Productions' contribution margin income statement for 180 shows performed in the year. Report only two categories of costs: variable and fixed. Green Productions Contribution Margin Income Statement Year Ended December 31, 20XX Sales Revenue Variable Costs Contribution Margin Fixed Costs Operating Income (Loss) 88
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Green Productions Profitability Analysis 1 Formula and Required Sales Calculation Formula Required Sales Fixed Costs Target Profit Contribution Margin ... View the full answer
Related Book For
Financial and Managerial Accounting
ISBN: 978-0132497978
3rd Edition
Authors: Horngren, Harrison, Oliver
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