Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Exercise 3 (25 points) All amounts are in KD F F M Investments is opening an office in Kuwait City Fised monthly costs are depreciation

image text in transcribed

Exercise 3 (25 points) All amounts are in KD F F M Investments is opening an office in Kuwait City Fised monthly costs are depreciation on office furniture (1,700), utities 12,000), special telecommunication lines (1,000, a revenue), advertisin telephone lines and c office rent 8,100 h an online brokerage service (2,000), and the salary of a financial planner (9% of g (12% of revenue. suppies and postage (4% of revenue, and usage fees for the omputerized brokerage service (5% of revenue). Requirements 1 Compute the breakeven revenue in dinars. If the average trade leads to kd 700 in revenue FFMI, how many trades are needed to breakeven? [10 points 2. Compute the amount needed to earn a target monthly operating income of 9,800 (5 points) 8. Graph FFMI's CVP relationships Assume that an average trade leads KD 700 in revenue. Show the breakeven point, the sales revenue line, the fixed cost line, the total cost line, the operating loss area, the operating income are, and the sales in units (trades) and dinars when monthly operating income of KD 9,800 is earned. The graph should range from 0 to 80 units. (5 points) Suppose that the average revenue FFMI earns increases to KD 800 per trade. Compute the new breakeven point in trades, How does this affect the breakeven point? (Spoints) 4

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_2

Step: 3

blur-text-image_3

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

Entrepreneurial Financial Management An Applied Approach

Authors: Jeffrey R. Cornwall, David O. Vang, Jean M. Hartman

4th Edition

0765646854, 978-0765646859

More Books

Students also viewed these Accounting questions

Question

Briefly explain at least five different ways of assessing truth.

Answered: 1 week ago

Question

7.1 Define selection and discuss its strategic importance.

Answered: 1 week ago