Check my work View previous attempt 1 Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high totaling $15.00 per ball of which 60% is direct labor cost Last year, the company sold 58,000 of these balls, with the following results: 55 points Book Print Sales (58,000 balls) Variable expenses Contribution margin Fixed expenses Net operating income $ 1,450,000 870.000 580,000 374,000 206,000 References $ Required: 1. Compute(a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per batt, if this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $206,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketbolls. If Northwood Company wants to maintain the same CM ratio as last year (os computed in requirement la), what seling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above, ME Prey 1 of 2 Next > You received partial credit in the previous attempt. 1 Check my work View previous attempt Northwood Company wants to maintain the same CM ratio as last year las computed in requirement ta), what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fed expenses per year to double. If the new plant is buit, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $206,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 58.000 bals (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. 55 points Book Print References Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req Req Reqs RA Reg 68 Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. (Round "Unit sales to break even to the nearest whole unit and other answers to 2 decimal places.) CM Ratio Unit sales to break even Degree of operating leverage ba ME GEW Prey 1 of 2 Next > 1 Check my work View previous attempt Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement ta), what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $206,000, as last b. Assume the new plant is built and that next year the company manufactures and sells 58,000 balls (the same number as sold lost year). Prepare a contribution format income statement and compute the degree of operating leverage. 55 Boints year? eBook Print References Complete this question by entering your answers in the tabs below. Reg 2 Reg 1 Req3 Reg. Reqs Reg 6 Reg 60 Due to an increase in tabor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? (Round "CM Ratio to 2 decimal places and 'Unit sales to break even to the nearest whole unit) % CM Ratio Unit sales to break even balls 1 Check my work View previous attempt Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a), what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $206,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 58,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. 55 points eBook Print References Complete this question by entering your answers in the tabs below. Reg Reg 2 Req3 Regu Res Reg A Reg 68 Refer to the data in Required (2). If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $206,000, as last year? (Round your answer to the nearest whole unit.) Number of bals Rege 1 Check my work View previous attempt Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement ta), what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $206,000, as lost year? b. Assume the new plant is built and that next year the company manufactures and sells 58,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. 55 points eBook Print References Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg Reg 4 Regs Req6A Reg 61 Refer again to the data in Required (2). The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement la), what selling price per ball must it charge next year to cover the increased labor costs? (Round your answer to 2 decimal places.) Selling price ( Reqs Regs > Prey 1 of 2 MC Graw Hill Next > 1 1 Check my work View previous attempt Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 18). what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $206,000, as last year? 6. Assume the new plant is built and that next year the company manufactures and sells 58,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. 55 points eBook Print References Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Req5 Reg 6 Req 60 Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? (Round "CM Ratio" to 2 decimal places and "Unit sales to break even to the nearest whole unit.) Show less CM Ratio Unit sales to break even balls Hegd Rey GA > ME Graw (Prey 1 of 2 !!! Next > 1 1 Check my work View previous attempt Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement ta), what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income $206,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 58,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. 55 points eBook Print References Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reg 5 Reg 6A Reg 6B If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $206,000, as last year? (Round your answer to the nearest whole unit.) Number of balls Rogo Reg 68 > Me Graw Prey 1 of 2 Next > 1 Check my werk View previous attempt b. Assume the new plant is built and that next year the company manufactures and sells 58,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. 55 points Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg4 Reqs Reg 6 Reg 66 eBook Print References Assume the new plant is built and that next year the company manufactures and sells 58,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. (Round "Degree of operating leverage' to 2 decimal places.) Northwood Company Contribution Income Statement $ 0 Degree of operating leverage