I have two accounting problem sets for managerial accounting in which I have an empty excel sheet and a formula sheet as an aid. I need these to be answered very accurately. The numbers match the available choices as labels below.

MBA 560 Chapter 10 Key: Analysis is only as good as the cost allocations. Sale price - variable cost = contribution margin Sales Less: Variable costs Contribution Margin Less: Fixed costs Net Income To find break-even in units Fixed cost / CM per unit = breakeven sales units $10 - $6 = $4 unit CM, if FC = 500,000, then BE = $500,000 / $4 = 125,000 units To find break-even in sales dollars 1. Find the contribution margin ratio (SP - VC) / SP = Contribution Margin Ratio Or Contribution margin divided by sales price ($10-$6) / $10 = .40 2. Divide fixed costs by the contribution margin ratio FC = $500,000 $500,000 / .40 = $1,250,000 FC / CM Ratio = breakeven sales dollars To find any level of target profit 1. 2. Add the target profit to the total fixed costs Calculate my the same process as used for break-even If desired profit = 1,000,000, then BE units = (500,000 + 1,000,000) / CM 1,500,000 / 4 = 375,000 units or BE dollars = 1,500,000 / .40 = $3,750,000 To find pretax profit After-tax profit / (1 - tax rate) = pretax profit Assume 30% tax rate (1,000,000 / (1-.30) = 1,428,571.43 Required sales dollars = (FC) 500,000 + (pre-tax profit) 1,428,571.43 / .40 = 4,821,428.57 Mod 8 Practice problem P 66A page 687 Req 1 Tickets Revenue sale price 1000 60 Variable expenses Programs Total Rev per show 60,000 cost cast wages 9 9,000 Cost per cast per show person 75 300 22,500 Total variable expenses per show 31,500 Contribution margin per show 28,500 Req 2 Sales rev less variable exp BE number of shows less fixed exp = FC / CM per show Op income Solution input FC 969,000 34 Note: I think the income statement approach is a waste of time, and we do not need it to solve the problem. Req 3 Number of shows to earn a traget profit FC (FC + profit) / CM per show Target Profit (Op profit) CM per show 969,000 3,078,000 28,500 shows 142 The solution thinks that 142 shows is unrealistic. I don't think that we have enough information. Req 4 Jersey Boys Contribution Margin Income Statement For the Year Ended December 31, 2012 Sales revenue 7,200,000 shows = 120 Variable expenses Contribution margin Fixed expenses Operating income 3,780,000 3,420,000 969,000 2,451,000 Note: The textbook says 100 shows. The problem on the course site will say 120 show. solve the problem. will say 120 show. Mod 8 Practice problem P 66A page 687 Req 1 Tickets sale price Total Rev per show 0 Req 1 Revenue Variable expenses Programs cost 0 Cost per cast per show person cast wages 0 Total variable expenses per show 0 Contribution margin per show 0 Req 1 Req 2 Sales rev less variable exp less fixed exp = Op income Req 2 FC BE number of shows FC / CM per show #DIV/0! Req 2 Note: I think the income statement approach is a waste of time, and we do not need it to solve the problem. Req 3 Number of shows to earn a traget profit Target Profit (Op income) FC 0 (FC + profit) / CM per show Req 3 CM per show 0 Req 3 shows #DIV/0! The solution thinks that 142 shows is unrealistic. I don't think that we have enough information. Req 4 Jersey Boys Contribution Margin Income Statement For the Year Ended December 31, 2012 Sales revenue 0 shows = Variable expenses Contribution margin Fixed expenses Operating income 0 0 0 0 Note: The textbook says 100 shows. The problem on the course site will say 120 show. solve the problem. will say 120 show. Mod 8 Practice problem P 67A page 687 Req 1 Sales rev less variable exp less fixed exp = Op income BE in cartons Unit Sale price Unit VC Unit CM 13.50 3.50 10.00 BE number of cartons FC = CM ratio CM/sales FC / CM per carton 1,065,000 BE cartons = Req 2 + target profit (Op Fixed exp income) FC Req 3 = target profit / CM ratio 1,065,000 304,000 0.74 Op income 1,850,000 University Contribution Margin Income Statement Month Ended June 30 Sales revenue Variable expenses Cost of goods sold Operating expenses Contribution margin Fixed expenses Operating income Req 4 / Contribution margin ratio 6,345,000 cartons sold = 1,069,250 575,750 1,645,000 4,700,000 1,065,000 3,635,000 unit CGS % unit op exp % BE sales = cartons at BE X sale price per carton Margin of safety = sales revenue - sales revenue at breakeven (BE) sales - of 470,000 cartons BE sales 6,345,000 1,437,750 Sales - Sales at BE Op Leverage factor = contribution margin / operating income CM from req 3 / op income 4,700,000 3,635,000 Op lev factor 1.293 Req 5 Increase in sales x Op lev factor = Increase in Op Income 0.12 1.293 15.52% Proof Original volume in cartons Add: Increase by 12% New volume CM per catron Total new CM in dollars Less: FC New Op Income Op income at 470,000 cartons Increase in Op Inc Percentage change 470,000 56,400 526,400 10 5,264,000 1,065,000 4,199,000 3,635,000 564,000 15.52% from Req 3 0.74 106,500 Solution input 470,000 0.65 0.35 2.275 1.225 BE cartons price BE dollars 106,500 13.50 1,437,750 Margin of safety 4,907,250 Mod 8 Practice problem P 67A page 687 Req 1 Sales rev less variable exp less fixed exp = Op income Req 1 BE in cartons Unit Sale price Unit VC Unit CM 0.00 BE number of cartons CM ratio CM/sales FC / CM per carton FC = BE cartons = Req 2 Fixed exp + target profit (Op income) / Contribution margin ratio FC target profit = / CM ratio #DIV/0! 0 Req 3 #DIV/0! University Contribution Margin Income Statement Month Ended June 30 Sales revenue Variable expenses Cost of goods sold Operating expenses Contribution margin Fixed expenses Operating income Req 4 Op income Req 3 0 0 0 0 0 0 0 cartons sold = unit CGS % unit op exp % BE sales = cartons at BE X sale price per carton Margin of safety = sales revenue - sales revenue at breakeven (BE) sales - of 470,000 cartons Sales - Sales at BE BE sales 0 #DIV/0! Op Leverage factor = contribution margin / operating income CM from req 3 Req 4 / op income 0 Op lev factor #DIV/0! 0 Req 5 Increase in sales x Op lev factor = Increase in Op Income #DIV/0! #DIV/0! enter as 2 decimal places Proof Original volume in cartons Add: Increase by 12% New volume CM per catron Total new CM in dollars Less: FC New Op Income Op income at 470,000 cartons Increase in Op Inc Percentage change 0 0 0 0 0 0 0 0 0 #DIV/0! from Req 3 #DIV/0! #DIV/0! Req 1 Req 2 Req 2 complete boxes below 0 0 0.00 BE cartons price BE dollars #DIV/0! 0.00 #DIV/0! Margin of safety #DIV/0! Req 4 2/28/2017 Module 8 Homework-Natalie Wagner Instructor: Suzanne Seymoure Course: Financial & Managerial Accting MBA560MBOL1 Student: Natalie Wagner Date: 2/28/17 Assignment: Module 8 Homework 1. A traveling production of The Lion King performs each year. The average show sells 1,000 tickets at $60 per ticket. There are 100 shows a year. The show has a cast of 70 , each earning an average of $260 per show. The cast is paid only after each show. The other variable expense is program printing costs of $6 per guest. Annual fixed expenses total $1,145,600. Requirements 1. Compute revenue and variable expenses for each show. 2. Use the income statement equation approach to compute the number of shows needed annually to break even. 3. Use the shortcut unit contribution margin approach to compute the number of shows needed annually to earn a profit of $3,902,200. Is this goal realistic? Give your reason. 4. Prepare The Lion King 's contribution margin income statement for 100 shows each year. Report only two categories of expenses: variable and fixed. Requirement 1. The revenue for each show is $ . The variable expenses for each show are $ . Requirement 2. Use the income statement equation approach to compute the number of shows needed annually to break even. Begin by determining the basic income statement equation. (1) (2) (3) = Operating income Using the basic income statement equation you determined above solve for the number of shows to break even. The number of shows needed annually to break even is . Requirement 3. Using the shortcut unit contribution margin approach, determine the formula that is used to compute the number of shows needed annually to earn a profit of $3,902,200. ( (4) + (5) ) / The number of shows needed annually to earn a profit of $3,902,200 is The profit goal of $3,902,200 is (7) (6) = Target # of shows . since The Lion King currently performs 100 shows a year. Requirement 4. Prepare the contribution margin income statement using only two categories of expenses. The Lion King Contribution Margin Income Statement For the Year Ended December 31 (8) (9) (10) (11) (12) https://xlitemprod.pearsoncmg.com/api/v1/print/accounting 1/7 2/28/2017 Module 8 Homework-Natalie Wagner (1) Contribution margin Fixed expenses Number of shows Sales revenue Variable expenses (3) Contribution margin Fixed expenses Number of shows Sales revenue Variable expenses (4) Contribution margin per show Fixed expenses Number of shows Operating income Sales revenue Variable expenses (5) Contribution margin per show Fixed expenses Number of shows Operating income Sales revenue Variable expenses (6) Contribution margin per show Fixed expenses Number of shows Operating income Sales revenue Variable expenses (8) Contribution margin Fixed expenses Operating income (loss) Sales revenue Total costs Variable expenses (9) Contribution margin Fixed expenses Operating income (loss) Sales revenue Total costs Variable expenses (10) Contribution margin Fixed expenses Operating income (loss) https://xlitemprod.pearsoncmg.com/api/v1/print/accounting (2) Contribution margin Fixed expenses Number of shows (7) Sales revenue Variable expenses unrealistic realistic Sales revenue Total costs Variable expenses 2/7 2/28/2017 Module 8 Homework-Natalie Wagner (11) Contribution margin Fixed expenses Operating income (loss) Sales revenue Total costs Variable expenses (12) Contribution margin Fixed expenses Operating income (loss) Sales revenue Total costs Variable expenses https://xlitemprod.pearsoncmg.com/api/v1/print/accounting 3/7 2/28/2017 Module 8 Homework-Natalie Wagner 2. Vast Spirit Calendars imprints calendars with college names. The company has fixed expenses of $1,095,000 each month plus variable expenses of $4.00 per carton of calendars. Of the variable expense, 71 % is Cost of Goods Sold, while the remaining 29% relates to variable operating expenses. The company sells each carton of calendars for $12.00. Requirements 1. Compute the number of cartons of calendars that Vast Spirit Calendars must sell each month to break even. 2. Compute the dollar amount of monthly sales Vast Spirit Calendars needs in order to earn $312,000 in operating income (round the contribution margin ratio to two decimal places). 3. Prepare the company's contribution margin income statement for June for sales of 470,000 cartons of calendars. 4. What is June's margin of safety (in dollars)? What is the operating leverage factor at this level of sales? 5. By what percentage will operating income change if July's sales volume is 11 % higher? Prove your answer. Requirement 1. Compute the number of cartons of calendars that Vast Spirit Calendars must sell each month to break even. Begin by determining the basic income statement equation. (1) (2) (3) = Operating income Using the basic income statement equation you determined above solve for the number of cartons to break even. The breakeven sales is cartons. Requirement 2. Compute the dollar amount of monthly sales Vast Spirit Calendars needs in order to earn $312,000 in operating income. ( (4) + (5) ) / (6) = Target sales in dollars (Round the contribution margin ratio to two decimal places.) The monthly sales needed to earn $312,000 in operating income is $ . Requirement 3. Prepare the company's contribution margin income statement for June for sales of 470,000 cartons of calendars. Vast Spirit Contribution Margin Income Statement Month Ended June 30 (7) (8) (9) (10) (11) (12) (13) Requirement 4. What is June's margin of safety (in dollars)? What is the operating leverage factor at this level of sales? Begin by determining the formula. (14) The margin of safety is $ https://xlitemprod.pearsoncmg.com/api/v1/print/accounting (15) = Margin of safety (in dollars) . 4/7 2/28/2017 Module 8 Homework-Natalie Wagner What is the operating leverage factor at this level of sales? Begin by determining the formula. (16) / (17) = Operating leverage factor (Round the operating leverage factor to three decimal places.) The operating leverage factor is . Requirement 5. By what percentage will operating income change if July's sales volume is 11 % higher? Prove your answer. (Round the percentage to two decimal places.) If volume increases 11 %, then operating income will increase %. Prove your answer. (Round the percentage to two decimal places.) Original volume (cartons) Add: Increase in volume New volume (cartons) Multiplied by: Unit contribution margin New total contribution margin Less: Fixed expenses New operating income vs. Operating income before change in volume Increase in operating income Percentage change % (1) Contribution margin Fixed expenses Number of cartons Sales revenue Variable expenses (3) Contribution margin Fixed expenses Number of cartons Sales revenue Variable expenses (4) Contribution margin ratio Fixed expenses Number of cartons Sales revenue Target operating income Variable expenses (5) Contribution margin ratio Fixed expenses Number of cartons Sales revenue Target operating income Variable expenses https://xlitemprod.pearsoncmg.com/api/v1/print/accounting (2) Contribution margin Fixed expenses Number of cartons Sales revenue Variable expenses 5/7 2/28/2017 Module 8 Homework-Natalie Wagner (6) Contribution margin ratio Fixed expenses Number of cartons Sales revenue Target operating income Variable expenses (7) Contribution margin Cost of goods sold Fixed expenses Operating expenses Operating income Sales revenue Variable expenses: (9) Contribution margin Cost of goods sold Fixed expenses Operating expenses Operating income Sales revenue Variable expenses: (8) (10) Contribution margin Cost of goods sold Fixed expenses Operating expenses Operating income Sales revenue Variable expenses: (11) Contribution margin Cost of goods sold Fixed expenses Operating expenses Operating income Sales revenue Variable expenses: (12) Contribution margin Cost of goods sold Fixed expenses Operating expenses Operating income Sales revenue Variable expenses: (13) Contribution margin Cost of goods sold Fixed expenses Operating expenses Operating income Sales revenue Variable expenses: (14) Contribution margin Fixed expenses Number of cartons Operating income Sales revenue Sales revenue at breakeven Variable expenses (15) Contribution margin Fixed expenses Number of cartons Operating income Sales revenue Sales revenue at breakeven Variable expenses https://xlitemprod.pearsoncmg.com/api/v1/print/accounting Contribution margin Cost of goods sold Fixed expenses Operating expenses Operating income Sales revenue Variable expenses: 6/7 2/28/2017 Module 8 Homework-Natalie Wagner (16) Contribution margin Fixed expenses Number of cartons Operating income Sales revenue Sales revenue at breakeven Variable expenses (17) Contribution margin Fixed expenses Number of cartons Operating income Sales revenue Sales revenue at breakeven Variable expenses https://xlitemprod.pearsoncmg.com/api/v1/print/accounting 7/7