Break-Even Point, Targeted Profit, Margin of Safety Cutlass Company's projected profit for the coming year is...
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Break-Even Point, Targeted Profit, Margin of Safety Cutlass Company's projected profit for the coming year is as follows: Total Per Unit Sales $200,000 $20 Less: Variable expenses Contribution margin Less: Fixed expenses Operating income 120,000 S 80,000 12 S 8 64,000 $ 16.000 Required: i. Compute the break-even point in units. ii. How many units must be sold to earn a profit of $30,000? Compute the contribution margin ratio. Using that ratio, compute the additional profit that Cutlass would earn if sales were $25,000 more than expected. For the projected level of sales, compute the margin of safety. 1ii. iv. Break-Even Point, Targeted Profit, Margin of Safety Cutlass Company's projected profit for the coming year is as follows: Total Per Unit Sales $200,000 $20 Less: Variable expenses Contribution margin Less: Fixed expenses Operating income 120,000 S 80,000 12 S 8 64,000 $ 16.000 Required: i. Compute the break-even point in units. ii. How many units must be sold to earn a profit of $30,000? Compute the contribution margin ratio. Using that ratio, compute the additional profit that Cutlass would earn if sales were $25,000 more than expected. For the projected level of sales, compute the margin of safety. 1ii. iv.
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I Break even Fixed Costs Unit Contribution 640008 p... View the full answer
Related Book For
Cornerstones of Managerial Accounting
ISBN: 978-1305103962
6th edition
Authors: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Posted Date:
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