Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Carta Vista Delivery is a rapidly growing delivery service. Last year, 80% of its revenue came from the delivery of mailing 'pouches and small standardized

Carta Vista Delivery is a rapidly growing delivery service. Last year, 80% of its revenue came from the delivery of mailing 'pouches and small standardized delivery boxes (which provides a 20% contribution margini: The other 20% of its revenue came from delivering non-standardded boxes (which provides a 20% contribution margini With the rapid growth of Internet retail sales Carla Vista believes that there are great opportunities for growth in the delivery of non-standardized boxes. The company has feed costs of $13.596 900. Sales mix is determined based upon total sales dollars (a) What is the company's break-even point in total sales dollars? At the break-even point, how much of the company's sales are provided by each type of service? Use Weighted Average Contribution Margin Ratio rounded to 2 decimal placeses 0.22 and round final answers to decimal places a 2.510) Total break-even sales Sale of mal pouches and small boxes Sale of rion-standard boxes (b) The company's management would like to hold its foxed costs comtant but shift its sales mis so that 60% of its revenue comes from t the delivery of non-standardized boxes and the remainder from pouches and small boxes. If this were to occur, what would be the company's break-even sales, and what amount of sales would be provided by each service type? (Use Weighted Average Contribution Margin Ratio rounded to 2 decimal places eg. 0.22 and round final answers to Odesame places a 2.510 Total break even sales Sale of mail pouches and small buses Sale of non-standardized box Oriole Repairs has 200 auto-maintenance service outlets nationwide. It performs primarily two lines of service: oil changes and brake repair. Oil change-related services represent 70% of its sales and provide a contribution margin ratio of 20%. Brake repair represents 30% of its sales and provides a 40% contribution margin ratio. The company's fixed costs are $15,620,800 (that is $78,104 per service outlet). Sales mix is determined based upon total sales dollars. Calculate the dollar amount of each type of service that the company must provide in order to break even. (Use Weighted Average Contribution Margin Ratio rounded to 2 decimal places eg. 0.25 and round final answers to 0 decimal places, eg. 2.510) Sales Dollars Needed Per Product Oil changes $ Brake repair $ The company has a desired net income of $54,990 per service outlet. What is the dollar amount of each type of service that must be performed by each service outlet to meet its target net income per outlet? (Use Weighted-Average Contribution Margin Ratio rounded to 2 decimal places eg. 0.25 and round final answers to O decimal places, e.g. 2.510.) Sales Dollars Needed Per Service Outlet Oil changes $ Brake repair $

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

Accounting

Authors: Thomson, South Western

22nd Edition

032464020X, 978-0324640205

More Books

Students also viewed these Accounting questions