Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Headland offers computer consulting, training, and repair services. For the most recent fiscal year, profit was $416,200, as follows: Consulting Training Repair Total Sales $593,500

image text in transcribedimage text in transcribed
Headland offers computer consulting, training, and repair services. For the most recent fiscal year, profit was $416,200, as follows: Consulting Training Repair Total Sales $593,500 $564,300 $405,200 $1,563,000 Less variable costs: Salaries 306,900 203,100 225,100 735,100 Supplies/parts 22,100 40,400 68,100 130,600 Other 1,400 2,800 5,000 9,200 Contribution margin $263,100 $318,000 $107,000 688,100 Less common fixed costs: Rent 54,700 Owner's salary 194,100 Utilities 13,000 Other 10,100 Profit $416,200Linda O'Flaherty, the owner of Headland, believes that in the coming year, she can increase sales by 18 percent. Assuming the current mix of services, what will be the percentage increase in prot associated with a 18 percent increase in sales? (Round weighted-average contribution margin ratio to 6 decimal places, e3. 0.124547 and nai answer to 2 decimal places, es. 15.25%.)

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

Psychology Applied To Teaching

Authors: Jack Snowman, Rick McCown

14th Edition

1285734556, 9781285734552

More Books

Students also viewed these Accounting questions

Question

2. To store it and

Answered: 1 week ago