Question
Break-Even and Margin of Safety Relationships At a recent staff meeting, the management of Boost Technologies Inc. was considering discontinuing the Rocket Man line of
Break-Even and Margin of Safety Relationships
At a recent staff meeting, the management of Boost Technologies Inc. was considering discontinuing the Rocket Man line of electronic games from the product line. The chief financial analyst reported the following current monthly data for the Rocket Man:
Units of sales | 420,000 |
Break-even units | 472,500 |
Margin of safety in units | 29,400 |
If 420,000 units are sold and sales at the break-even point are 472,500 units, there is
an adequateno
margin of safety.
2.Cordell, Inc. has an operating leverage of 3. Sales are expected to increase by 9% next year. What is the expected change in operating income next year fill in the blank 1 %
3.Sleep Tight, Inc. manufactures bedding sets. The budgeted production is for 52,000 comforters this year. Each comforter requires 1.5 hours to cut and sew the material. The cost of cutting and sewing labor is $12.50 per hour. Determine the direct labor budget for this year. $fill in the blank 1
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