I need help with a problem in managerial accounting. All screenshots pertain to the same question.
Feather Friends, lnc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and xed expenses total $200,000 per year. Its operating results for last year were as follows: Sales is 2, 248. 888 Variable expenses 1,128,888 Contribution margin 1, 128.888 Fixed expenses 288,088 Net operating income $ 920.888 ' 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. If this year's sales increase by $60,000 and xed expenses do not change, how much will net operating income increase? 4a. What is the degree of operating leverage based on last year's sales? 4b. Assume the president expects this year's sales to increase by 14%. 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 $67,000 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 $1.60 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $920,000 net operating income as last year? Complete this question by entering your answers In the tabs below. Req 1 Req 2 Req 3 Req 4A Req 4B Req 5A Req SB Req 6 What is the product's CM ratio? - % Feather Friends, |nc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and xed expenses total $200,000 per year. Its operating results for last year were as follows: Sales is 2, 240, 0% Variable expenses 1,120,800 Contribution margin 1,120,309 Fixed expenses 200,800 Net operating income 55 920,009 ' 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. If this year's sales increase by $60,000 and xed 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 sales to increase by 14%. 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 $67,000 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 $1.60 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $920,000 net operating income as last year? Complete this question by entering your answers In the tabs below. Use the CM ratio to determine the break-even point in dollar sales. (Do not round intermediate calculations.) Feather Friends, |nc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and xed expenses total $200,000 per year. Its operating results for last year were as follows: Sales is 2, 240, 0% Variable expenses 1,120,800 Contribution margin 1,120,009 Fixed expenses 200,000 Net operating income 55 920,009 ' 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. If this year's sales increase by $60,000 and xed 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 sales to increase by 14%. 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 $67,000 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 $1.60 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $920,000 net operating income as last year? Complete this question by entering your answers In the tabs below. If this year's sales increase by $60,000 and xed expenses do not change, how much will net operating income increase? Feather Friends, |nc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and xed expenses total $200,000 per year. Its operating results for last year were as follows: Sales is 2, 240, 0% Variable expenses 1,120,800 Contribution margin 1,120,309 Fixed expenses 200,800 Net operating income 55 920,009 ' 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. If this year's sales increase by $60,000 and xed 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 sales to increase by 14%. 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 $67,000 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 $1.60 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $920,000 net operating income as last year? Complete this question by entering your answers In the tabs below. What is the degree of operating leverage based on last year's sales? (Round intermediate calculations and nal answers to 2 decimal places.) Feather Friends, lnc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and xed expenses total $200,000 per year. Its operating results for last year were as follows: Sales is 2, 240, 0% Variable expenses 1,120,806 Contribution margin 1,120,309 Fixed expenses 200,800 Net operating income 55 920,009 ' 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. If this year's sales increase by $60,000 and xed expenses do not change, how much will net operating income increase? 4a. What is the degree of operating leverage based on last year's sales? 4b. Assume the president expects this year's sales to increase by 14%. 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 $67,000 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 $1.60 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $920,000 net operating income as last year? Complete this question by entering your answers In the tabs below. Assume the president expects this year's sales to increase by 14%. Using the degree of operating leverage from last year, what percentage increase in net operating income will the company realize this year? (Round intermediate calculations and nal answer to 2 decimal places.) Feather Friends, lnc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and xed expenses total $200,000 per year. Its operating results for last year were as follows: Sales is 2, 240, 0% Variable expenses 1,120,806 Contribution margin 1,120,309 Fixed expenses 200,800 Net operating income 55 920,009 ' 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. If this year's sales increase by $60,000 and xed expenses do not change, how much will net operating income increase? 4a. What is the degree of operating leverage based on last year's sales? 4b. Assume the president expects this year's sales to increase by 14%. 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 $67,000 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 $1.60 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $920,000 net operating income as last year? Complete this question by entering your answers In the tabs below. The sales manager is convinced that a 12% reduction in the selling price, combined with a $67,000 increase in advertising, would increase this year's unit sales by 25%. If the sales manager is right, what would be this year's net operating income if his ideas are implemented? (Do not round intermediate calculations.) Feather Friends, lnc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and xed expenses total $200,000 per year. Its operating results for last year were as follows: Sales is 2, 240, 0% Variable expenses 1,120,806 Contribution margin 1,120,309 Fixed expenses 200,800 Net operating income 55 920,009 ' 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. If this year's sales increase by $60,000 and xed expenses do not change, how much will net operating income increase? 4a. What is the degree of operating leverage based on last year's sales? 4b. Assume the president expects this year's sales to increase by 14%. 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 $67,000 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 $1.60 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $920,000 net operating income as last year? Complete this question by entering your answers In the tabs below. The sales manager is convinced that a 12% reduction in the selling price, combined with a $67,000 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.) Feather Friends, lnc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and xed expenses total $200,000 per year. Its operating results for last year were as follows: Sales is 2, 240, 0% Variable expenses 1,120,806 Contribution margin 1,120,000 Fixed expenses 200,000 Net operating income 55 920,000 ' 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. If this year's sales increase by $60,000 and xed expenses do not change, how much will net operating income increase? 4a. What is the degree of operating leverage based on last year's sales? 4b. Assume the president expects this year's sales to increase by 14%. 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 $67,000 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 $1.60 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $920,000 net operating income as last year? Complete this question by entering your answers In the tabs below. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $1.60 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $920,000 net operating income as last year? Show IessA
