Question: Tracy, Inc., estimates that next years results will be: Sales revenue (75,000 units) . . . . . . . . . . . .
Tracy, Inc., estimates that next year’s results will be:
Sales revenue (75,000 units) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$ 900,000
Less variable costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (375,000)
Less fixed costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (300,000)
Profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 225,000
Recompute profit, assuming each of the following independent conditions:
1. A 9% increase in the contribution margin
2. An 8% increase in the sales volume
3. A 4% decrease in the sales volume
4. A 6% increase in variable costs per unit
5. A 5% decrease in fixed costs
6. A 5% increase in fixed costs
7. A 12% increase in the sales volume and a 6% increase in fixed costs
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1 Sales revenue 900000 Variable costs 375000 Contribution margin 525000 x 109 572250 Fixed costs 300... View full answer
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