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Mauro Products distributes a single product, a woven basket whose selling price is $27 per unit and whose variable expense is $22 per unit. The company's monthly fixed expense is $5,500. Required: 1. Calculate the company's break-even point in unit sales. 2. Calculate the company's break-even point in dollar sales. (Do not round intermediate calculations.) 3. If the company's fixed expenses increase by $600, what would become the new break-even point in unit sales? In dollar sales? (Do not round intermediate calculations.) 1. Break-even point in unit sales baskets 2. Break-even point in dollar sales 3. Break-even point in unit sales baskets Break-even point in dollar sales eck my Data for Hermann Corporation are shown below: Per Unit Percent of Sales $ 70 100% Selling price Variable expenses 49 70 Contribution margin. $ 21 30% Fixed expenses are $74,000 per month and the company is selling 4,400 units per month. 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $4 per unit and increase unit sales by 25%. 2-b. Should the higher-quality components be used? Complete this question by entering your answers in the tabs below. Req 2A Req 28 Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher- quality components that increase the variable expense by $4 per unit and increase unit sales by 25%. Net operating income by Reg 2A Req 2B > Check my work Last month when Holiday Creations, Inc., sold 43,000 units, total sales were $172,000, total variable expenses were $139,320, and fixed expenses were $37,800. Required: 1. What is the company's contribution margin (CM) ratio? 2. What is the estimated change in the company's net operating income if it can increase sales volume by 700 units and total sales by $2,800? (Do not round intermediate calculations.) 1. Contribution margin ratio % 2. Estimated change in net operating income Mauro Products distributes a single product, a woven basket whose selling price is $27 per unit and whose variable expense is $22 per unit. The company's monthly fixed expense is $5,500. Required: 1. Calculate the company's break-even point in unit sales. 2. Calculate the company's break-even point in dollar sales. (Do not round intermediate calculations.) 3. If the company's fixed expenses increase by $600, what would become the new break-even point in unit sales? In dollar sales? (Do not round intermediate calculations.) 1. Break-even point in unit sales baskets 2. Break-even point in dollar sales 3. Break-even point in unit sales baskets Break-even point in dollar sales eck my Data for Hermann Corporation are shown below: Per Unit Percent of Sales $ 70 100% Selling price Variable expenses 49 70 Contribution margin. $ 21 30% Fixed expenses are $74,000 per month and the company is selling 4,400 units per month. 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $4 per unit and increase unit sales by 25%. 2-b. Should the higher-quality components be used? Complete this question by entering your answers in the tabs below. Req 2A Req 28 Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher- quality components that increase the variable expense by $4 per unit and increase unit sales by 25%. Net operating income by Reg 2A Req 2B > Check my work Last month when Holiday Creations, Inc., sold 43,000 units, total sales were $172,000, total variable expenses were $139,320, and fixed expenses were $37,800. Required: 1. What is the company's contribution margin (CM) ratio? 2. What is the estimated change in the company's net operating income if it can increase sales volume by 700 units and total sales by $2,800? (Do not round intermediate calculations.) 1. Contribution margin ratio % 2. Estimated change in net operating income
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Related Book For
Managerial Accounting
ISBN: 978-1259307416
16th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer
Posted Date:
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