Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

ComputerGuard offers computer consulting, training, and repair services. For the most recent fiscal year, profit was $268,800, as follows: Consulting Training Repair Total Sales $523,100

ComputerGuard offers computer consulting, training, and repair services. For the most recent fiscal year, profit was $268,800, as follows:

Consulting Training Repair Total
Sales $523,100 $502,200 $387,900 $1,413,200
Less Variable Costs:
Salaries 268,500 218,300 215,900 702,700
Supplies/Parts 22,900 41,000 70,100 134,000
Other 1,300 2,700 5,800 9,800
Contribution Margin $230,400 $240,200 $96,100 $566,700
Less Common Fixed Costs:
Rent 58,800
Owner's Salary 213,900
Utilities 13,900
Other 11,300
Profit $268,800

Linda OFlaherty, the owner of ComputerGuard, believes that in the coming year, she can increase sales by 20 percent. Assuming the current mix of services, what will be the percentage increase in profit associated with a 20 percent increase in sales? (Round weighted-average contribution margin ratio to 6 decimal places, e.g. 0.124547 and final answer to 2 decimal places, e.g. 15.25%.)

Increase in profit ______ %

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

Lead Auditor ISO 22000 2018 Food Safety Management Systems FSMS Course

Authors: Marius Hauta

1st Edition

B0BTSCBJ82, 979-8376159750

More Books

Students also viewed these Accounting questions

Question

Define signaling and screening and give an example of each.

Answered: 1 week ago

Question

How does the concept of hegemony relate to culture?

Answered: 1 week ago

Question

c. What groups were least represented? Why do you think this is so?

Answered: 1 week ago