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16 3 points A firm has a contribution margin of 40% and implements and is analyzing whether or not to implement an advertising program costing
16 3 points A firm has a contribution margin of 40% and implements and is analyzing whether or not to implement an advertising program costing $30,000. What is the required minimum incremental revenue generated by the advertising program in order to make it acceptable? $42.000 $30,000 $75,000 $48.000 17 3 points Peyton Company manufactures Phone X and Phone Y. Peyton can sell all it can make of either. Based on the following data, assuming the number of hours is a constraint, which statement is true? Sales price Variable cost $48 38 Y $44 28 Time needed to process 5 hours 8 hours Y is more profitable than X X and Y are equally profitable. X is more profitable than Y. Neither X nor Y is profitable 18 3 points Spice Inc.'s unit selling price is $60, variable costs are 75% of the selling price, and the break even point in units is 1,000 units. Spices operating income If it sells 1.200 units will be: $12,000 $72.000 $3.000 $9.000 19 25 points Format #1 Format #2 Sales Sales Cost of Goods Sold Gross Profit Selling & Administrative Expenses Income from operations 2,200,000 1,430,000 770,000 730,000 40,000 2,200,000 bo,000 1,500,000 Variable Costs Contribution Margin Fixed Costs: Fixed Manufacturing Costs Fixed Selling & Administrative Exp. Income from Operations 757,000 703,000 40,000 Assuming 1,000,000 units were sold in the statements above, the break-even point in revenues is: $2,200,000 S2,141,333 $2,085,714 $1,460,000
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