Mister Geppetto decided not to advertise. He still sees an increase in demand and in April...

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Mister Geppetto decided not to advertise. He still sees an increase in demand and in April 2019 the number of units manufactured and sold increased to 27,000. Total fixed costs and selling price are the same as in March 2019. (a) What is the margin of safety in April 2019? 17x27000/20=63750 (b) What is the operating leverage in April 2019? 63750-22950=40800 (c) Given the higher demand for the product, Mister Geppetto considers increasing the selling price. Mister Geppetto wishes to earn an operating profit of $250,000. What should be the new selling price? Enter your answer here Mister Geppetto decided not to advertise. He still sees an increase in demand and in April 2019 the number of units manufactured and sold increased to 27,000. Total fixed costs and selling price are the same as in March 2019. (a) What is the margin of safety in April 2019? 17x27000/20=63750 (b) What is the operating leverage in April 2019? 63750-22950=40800 (c) Given the higher demand for the product, Mister Geppetto considers increasing the selling price. Mister Geppetto wishes to earn an operating profit of $250,000. What should be the new selling price? Enter your answer here

Answer rating: 100% (QA)

Sales revenue 27000 60 1620000 Less Variable cost 27000 20155 1080000 Contribution margin 540000 Les... View the full answer