Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

**Can u show the steps and formula used for each question please and thank you! Super Sales Company is the exclusive distributor for a high-quality

**Can u show the steps and formula used for each question please and thank you!

Super Sales Company is the exclusive distributor for a high-quality knapsack. The product sells for $120 per unit and has a CM ratio of 25%. The companys fixed expenses are $405,000 per year. The company plans to sell 14,000 knapsacks this year.

1. What are the variable expenses per unit?

2. Use the equation method for the following:

a. What is the break-even point in units and in sales dollars?

b. What sales level in units and in sales dollars is required to earn an annual profit of $117,000?

c. What sales level in units is required to earn an annual after-tax profit of $117,000 if the tax rate is 25%?

d. Assume that through negotiation with the manufacturer, Super Sales Company is able to reduce its variable expenses by $6 per unit. What is the companys new break-even point in units and in sales dollars? (Do not round intermediate calculations. Round your final answers to the nearest whole number.)

3. Use the formula method for the following:

a. What is the break-even point in units and in sales dollars?

b. What sales level in units and in sales dollars is required to earn an annual profit of $117,000?

c. What sales level in units is required to earn an annual after-tax profit of $117,000 if the tax rate is 25%?

d. Assume that through negotiation with the manufacturer, Super Sales Company is able to reduce its variable expenses by $6 per unit. What is the companys new break-even point in units and in sales dollars? (Do not round intermediate calculations. Round your final answers to the nearest whole number.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Margins Of Error In Accounting

Authors: D. Myddelton

1st Edition

0230219918, 9780230219915

More Books

Students also viewed these Accounting questions

Question

Contrast intrinsic motivation with extrinsic motivation.

Answered: 1 week ago

Question

Did you open with an issue explanation?

Answered: 1 week ago