Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I need help with my assignment please.. Henna Co. produces and sells two products, T and O. It manufactures these products in separate factories and

I need help with my assignment please..

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

Henna Co. produces and sells two products, T and O. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 45,000 units of each product. Sales and costs for each product follow. Sales Variable costs Product T $787,500 551,250 Product O $787,500 78,750 Contribution margin Fixed costs 236,250 111,250 708,750 583,750 Income before taxes Income taxes (40% rate) 125,000 50,000 125,000 50,000 Net income $ 75,000 $ 75,000 Reyulieu. 1. Compute the break-even point in dollar sales for each product. (Enter CM ratio as percentage rounded to 2 decimal places.) Product T Contribution Margin Ratio Choose Numerator: Choose Denominator: Contribution Margin Ratio Contribution margin ratio Break-even point in dollars Choose Numerator: Choose Denominator: = Break-Even Point in Dollars Break-even point in dollars Product O Contribution Margin Ratio Contribution margin ratio Break-Even Point in Dollars Break-even point in dollars Problem 5-5A Part 2 2. Assume that the company expects sales of each product to decline to 28,000 units next year with no change in unit selling price. Prepare forecasted financial results for next year following the format of the contribution margin income statement as just shown with columns for each of the two products (assume a 40% tax rate). Also, assume that any loss before taxes yields a 40% tax benefit. (Round "per unit" answers to 2 decimal places. Enter losses and tax benefits, if any, as negative values.) HENNA CO. Forecasted Contribution Margin Income Statement Product T Producto Units $ Per unit T otal $ Per unit Total Total Contribution margin Net income (loss) Problem 5-5A Part 3 3. Assume that the company expects sales of each product to increase to 59,000 units next year with no change in unit selling price. Prepare forecasted financial results for next year following the format of the contribution margin income statement shown with columns for each of the two products (assume a 40% tax rate). (Round "per unit" answers to 2 decimal places.) HENNA CO. Forecasted Contribution Margin Income Statement Product T Producto Units $ Per unit Total $ Per unit Total Total Contribution margin Net income (loss)

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

Effective Communications

Authors: Elearn

1st Edition

1138456136, 9781138456136

More Books

Students also viewed these Accounting questions

Question

5 What does it mean to think of an organisation as an open system?

Answered: 1 week ago