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I need this copleted to use a study guide. you do not have to show all teh work i just want the correct answers in
I need this copleted to use a study guide. you do not have to show all teh work i just want the correct answers in order to verify if i have done it right.
Handout 6 (for Day 2) 1. Keebee, Inc. sells laptops for $1,000 per unit. Variable costs per unit are $400 and monthly fixed costs are $2,400,000. The contribution margin income statement for last month is as follows. Sales price Variable cost Contribution margin Fixed costs Profit Contribution Margin Income Statement Keebee, Inc. 6,000 units sold Per unit Total $1,000 $6,000,000 400 2,400,000 $600 3,600,000 2,400,000 $1,200,000 Percent of sales 100% 40% 60% 1. Compute the degree of operating leverage for last month. 2. All else equal, if the sales revenue increases by 20%, compute the percentage of profit increase. 3. One major competitor, Chiwen, Inc. sells a similar product. Its contribution margin income statement for last month is as follows. Sales price Variable cost Contribution margin Fixed costs Profit Contribution Margin Income Statement Chiwen, Inc. 10,000 units sold Per unit Total $800 $8,000,000 400 4,000,000 $400 4,000,000 2,000,000 $ 2,000,000 Compute the degree of operating leverage of this competitor. 4. Which company is better positioned to withstand a dramatic decrease in demand? Percent of sales 100% 50% 50% 2. Graham Corp. sells two products. Product A sells for $200 per unit, and has unit variable costs of $150. Product B sells for $50 per unit, and has unit variable costs of $20. Currently, Graham sells three units of product B for every two units of product A sold. Graham has fixed costs of $760,000. What is Graham's break-even point in units? A. 20,000 units of A and 20,000 units of B B. 12,000 units of A and 8,000 units of B C. 8,000 units of A and 12,000 units of B D. 10,000 units of A and 10,000 units of B 3. Roland had revenues of $600,000 in March. Fixed costs in March were $200,000 and profit was $40,000. Answer the following questions. a. What was the contribution margin percentage? b. What monthly sales volume (in dollars) would be needed to break-even? c. What sales volume (in dollars) would be needed to earn $150,000Step by Step Solution
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