Feather Friends, Inc, distributes a high-quality wooden birdhouse that sells for $120 per unit. Variable expenses are $60.00 per unit. and fixed expenses total $180,000 per year. Its operating results for last year were as follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income $3,240,000 2, 620.000 1, 620,000 180,000 $1,440,000 Required: Answer each question independently based on the original data 1. What is the product's CM ratio? 2. Use the CM ratio to determine the break-even point in dollar sales. 3. Assume this year's unit sales and total sales increase by 59,000 units and $7,080,000, respectively. If the fixed expenses do not change, how much will net operating income increase? 4-a. What is the degree of operating leverage based on last year's sales? 4-6. Assume the president expects this year's unit sales to increase by 10% Uslag the degree of operating leverage from last year. what percentage increase in net operating income will the company realize this year? 5. The sales manager is convinced that a 12% reduction in the selling price, combined with a $79,000 increase in advertising, would Increase this year's unit sales by 25% a. If the sales manager is right, what would be this year's net operating income if his ideas are implemented? b. If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $2.30 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's unit sales by 25% How much could the president increase this year's advertising expense and still earn the same $1,440,000 net operating income as last year? Complete this question by entering your answers in the tabs below. Reg 58 Reg 6 Reg SA Reg 2 Reg 4 Reg 1 Reg 3 Req 48 What is the product's CM ratio? 1. What is the product's CM ratio? 2. Use the CM ratio to determine the break even point in dollar sales 3. Assume this year's unit sales and total sales increase by 59,000 units and $7,080,000, respectively. If the fixed expenses do change, how much will niet operating income increase? 4 a What is the degree of operating leverage based on last year's sales? 4 b. Assume the president expects this year's unit sales to increase by 10%. Using the degree of operating leverage from last what percentage increase in net operating income will the company realize this year? 5. The sales manager is convinced that a 12% reduction in the selling price, combined with a $79,000 increase in advertising. increase this year's unit sales by 25% a. If the sales manager is right, what would be this year's net operating income if his ideas are implemented? b. If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $2.30 per thinks that this move. combined with some increase in advertising, would increase this year's unit sales by 25% How much president increase this year's advertising expense and still earn the same $1,440.000 net operating income as last year? Complete this question by entering your answers in the tabs below. Req1 Reg 2 Reg 3 Req 4A Reg 48 Reg 5A Reg SB Reg 6 What is the product's CM ratio? CM reti % Reg 2 > Income 61.400.000 Skipped Required: Answer each question independently based on the original data: 1. What is the product's CM ratio? 2. Use the CM ratio to determine the break-even point in dollar sales 3. Assume this year's unit sales and total sales increase by 59,000 units and $7,080,000, respectively. If the foed expenses do not change, how much will net operating income increase? 4-a. What is the degree of operating leverage based on last year's sales? 4-6. Assume the president expects this year's unit sales to increase by 10%. Using the degree of operating leverage from last yeat, what percentage increase in net operating income will the company realize this year? 5. The sales manager is convinced that a 12% reduction in the selling price.combined with a $79.000 increase in advertising. would increase this year's unit sales by 25% a. If the sales manager is right , what would be this year's net operating income of his ideas are implemented b. If the sales manager's ideas are implemented, how much wil net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $2.30 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's unit sales by 25%. How much could the president increase this year's advertising expense and still earn the same $1,440,000 net operating income as last year? Complete this question by entering your answers in the tabs below. Reg 1 Peg 2 Reg 3 Reg 4 Reg 43 Reg 5A Reg SB Reg 6 Use the CM ratio to determine the break-even point in dollar sales. (Do not round intermediate calculations.) Break-even point in dollar sales 5 operating the 1/440.000 Seco Required: Answer each question independently based on the original data 1 What is the product's CM ratio? 2. Use the CM ratio to determine the break even por dolar sales 3. Assume this year's unit sales and total sales increase by 59.000 units and $7,080.000, respectively. If the food expenses do not change how much will net operating income increase? 4-a. What is the degree of operating leverage based on last year's sales? 4.6. Assume the president expects this year's unit sales to increase by 10%. Using the degree of operating leverage from last year, what percentage increase in net operating income will the company realize this year? 5. The sales manager is convinced that a 12% reduction in the selling price, combined with a $79.000 increase in advertising, would Increase this year's unit sales by 25% a. If the sales manager is right, what would be this year's net operating income if his ideas are implemented? b. If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $230 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's unit sales by 25% How much could the president increase this year's advertising expense and still earn the same 51.440,000 net operating income as last year? Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Red Reg 48 Reg SA Red 50 Reg 6 Assume this year's unit sales and total sales increase by 59,000 units and $7,080.000, respectively. If the fixed expenses do not change, how much will net operating income increase? (Do not round intermediate calculations Net operating income DY 5 Het operating income $1,140.000 Skipped Required: Answer each question independently based on the orginal data 1. What is the product's CM ratio? 2. Use the CM ratio to determine the break even point in dollar sales 3. Assume this year's unit sales and total sales increase by 59,000 units are $1030.000, respectvely. If the feed expenses do not change, how much will net operating income increase? 4-a. What is the degree of operating leverage based on last year's sales? 4-b. Assume the president expects this year's unit sales to increase by 10% Using the degree of operating leverage from last year, what percentage increase in net operating income will the company realize this year 5. The sales manager is convinced that a 12% reduction in the selling price, combined with a $79,000 increase in advertising would increase this year's unit sales by 25% a. If the sales manager is right, what would be this year's net operating income if his ideas are implemented b. If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $230 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's unit sales by 25%. How much could the president increase this year's advertising expense and still earn the same $1,440.000 net operating income as last year? Complete this question by entering your answers in the tabs below. Req 4A Reg 49 Reg 6 Reg 1 Reg 2 Reg 3 Red SA Rea 56 What is the degree of operating leverage based on last year's sales? (Hound intermediara calculations and final answers to 2 decimal places.) Degree of operating leverage 5 Net cperating income 31.10,000 Required: Answer each question independently based on the original data Skloped 1 What is the product's CM ratio? 2. Use the CM ratio to determine the break even point in dolar sales 3. Assume this year's unit sales and total sales increase by 59.000 unins and $7080,000, respectively. If the fored expenses do not change, how much will net operating income increase? 4-a. What is the degree of operating leverage based on last year's sales? 4-6. Assume the president expects this year's unit sales to increase by 10%. Using the degree of operating leverage from last year. what percentage increase in net operating income will the company realize this year? 5. The sales manager is convinced that a 12% reduction in the selling price, combined with a 579,000 increase in advertising, would Increase this year's unit sales by 25% a. If the sales manager is right, what would be this year's net operating income of his ideas are implemented? b. If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $2,30 per unit. He thinks that this move, combined with some increase in advertising would increase this year's unit sales by 25% How much could the president increase this year's advertising expense and still earn the same 51.440,000 net operating income as last year? Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Reg 4A Rea 48 Reg SA Reg SB Reg 6 Assume the president expects this year's unit sales to increase by 10%. Using the degree of operating Hverage from last year, what percentage increase in net operating income will the company realize this year? (Round Intermediate calculations and final answer to 2 decimal places.) Net operating income increases by 5 Net operating income $1.410.000 Required: Answer each question independently based on the original data Skipped 1 What is the product's CM ratio? 2. Use the CM ratio to determine the break-even point in dollar sales 3 Assume this year's unft sales and total sales increase by 59.000 units and $7.080.000. respectively if the food expenses do not change, how much will net operating income increase? 4-a. What is the degree of operating leverage based on last year's sales? 4-6. Assume the president expects this year's unit sales to increase by 10%. Using the degree of operating leverage from last year what percentage increase in net operating income will the company realize this year? 5 The sales manager is convinced that a 12% reduction in the selling price, combined with a $79.000 increase in advertising, would increase this year's unit sales by 25% a. If the sales manager is right, what would be this year's net operating income of his ideas are implemented? b. If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year 6. The president does not want to change the selling price Instead, he wants to increase the sales commission by $2.30 pet unit. He thinks that this move, combined with some increase in advertising, would increase this year's unit sales by 25% How much could the president increase this year's advertising expense and still earn the same 51,440.000 net operating income as last year? Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reg 48 RESA Reg SB Reg 6 The sales manager is convinced that a 12% reduction in the selling price, combined with a $79,000 increase in advertising would increase this year's unit sales by 25%. If the sales manager is night, what would be this year's net operating income if his ideas are implemented? (Do not round intermediate calculations.) Not operating income (loss) Required: Answer each question independently based on the original data 1. What is the product's CM ratio? 2. Use the CM ratio to determine the break even point in dollar sales. 3 Assume this year's unit Sales and total sales increase by 59,000 units and $7,080,000, respectively. If the fixed expenses do not change, how much will net operating income increase? 4-a. What is the degree of operating leverage based on last year's sales? 4b. Assume the president expects this year's unit sales to increase by 10%. Using the degree of operating leverage from last year. what percentage increase in net operating income will the company realize this year? 5. The sales manager is convinced that a 12% reduction in the selling price, combined with a $79,000 Increase in advertising, woul increase this year's unit sales by 25% a. If the sales manager is right, what would be this year's net operating income if his ideas are implemented? b. If the sales manager's ideas are implemented, how much wil net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $2.30 per unit thinks that this move, combined with some increase in advertising, would increase this year's unit sales by 25% How much could president increase this year's advertising expense and still earn the same $1,440,000 net operating income as last year? Complete this question by entering your answers in the tabs below. Rex 5B Reg 1 Reg 2 Reg 6 Reg 3 Reg 4B Reg 4A Req 5A The sales manager is convinced that a 12% reduction in the selling price, combined with a $79,000 increase in advertising, would increase this year's unit sales by 25%. If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year? (Negative amounts should be input with a minus sign.) Increase (decrease) to net operating income Moped Required: Answer each question independently based on the original data: 1. What is the product's CM ratio? 2. Use the CM ratio to determine the break-even point in dollar sales 3. Assume this year's unit sales and total sales increase by 59,000 units and $7,080.000, respectively. If the fixed expenses do not change, how much will net operating income increase? 4-a. What is the degree of operating leverage based on last year's sales? 4-6. Assume the president expects this year's unit sales to increase by 10%. Using the degree of operating leverage from last year, what percentage increase in net operating income will the company realize this year? 5. The sales manager is convinced that a 12% reduction in the selling price, combined with a 579,000 Increase in advertising woul increase this year's unit sales by 25% a. If the sales manager is right, what would be this year's net operating income if his ideas are implemented? b. If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $230 per unit thinks that this move, combined with some increase in advertising, would increase this year's unit sales by 25% How much could president increase this year's advertising expense and still earn the same $1.440,000 net operating income as last year? Complete this question by entering your answers in the tabs below. Reg 3 Reg 1 Reg 2 Reg 4 Reg SA Reg 4B Reg SB Rua 6 The president does not want to change the selling price. Instead, he wants to increase the sales commission by $2.30 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's unit sales by 25% How much could the president increase this year's advertising expense and still earn the same $1,440,000 net operating income as last year? (Do not round intermediate calcuations) Show less The amount by which advertising can be increased is