Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Dana's Ribbon World makes award rosettes. Following is information about the company: Variable cost per rosette Sales price per rosette Total fixed costs per month

image text in transcribedimage text in transcribed

Dana's Ribbon World makes award rosettes. Following is information about the company: Variable cost per rosette Sales price per rosette Total fixed costs per month $ 2.00 4.00 3000.00 Required: 1. Suppose Dana's would like to generate a profit of $960. Determine how many rosettes it must sell to achieve this target profit. (Round your intermediate calculations to 2 decimal places and final answer to the nearest whole number.) Target Units 1,980 2. If Dana's sells 1,900 rosettes, compute its margin of safety in units, in sales dollars, and as a percentage of sales. (Round your Margin of Safety percentage to two decimal places (i.e. .1234 should be entered as 12.34%). 400 Rosettes Margin of Safety (Units) Margin of Safety in Dollars Percentage of Sales $ 1,600 21.05% 3. Calculate Dana's degree of operating leverage if it sells 1,900 rosettes. (Round your intermediate calculations to 2 decimal places and final answer to 4 decimal places.) Degree of Operating Leverage 4. Using the degree of operating leverage, calculate the change in Dana's profit if unit sales drop to 1,520 units. Confirm this calculations to 4 decimal places and final answer to 2 decimal places. (i.e. 1234 should be entered as 12.34%.)) preparing a new contribution margin income statement. (Round your intermediate Effect on Profit % Contribution Margin Income Statement For 1520 Rosettes Contribution Margin Income from Operations

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

International Marketing And Export Management

Authors: Gerald Albaum , Alexander Josiassen , Edwin Duerr

8th Edition

1292016922, 978-1292016924

Students also viewed these Accounting questions