Answered step by step
Verified Expert Solution
Question
1 Approved Answer
IF THE IMAGE IS TOO SMALL PLEASE ZOOM IN YOUR WEB BROWSER BY CLICKING THE MIDDLE MOUSE BUTTON AND HOLDING THE CONTROL KEY AND SCROLLING
IF THE IMAGE IS TOO SMALL PLEASE ZOOM IN YOUR WEB BROWSER BY CLICKING THE MIDDLE MOUSE BUTTON AND HOLDING THE CONTROL KEY AND SCROLLING FORWARD, WHICH INCREASES THE PAGE SIZE.
4. Smith Company manufactures and sells a single product. The company's sales and expenses for last year follow: (Click the icon to view the information.) Read the requirements Requirement 1. Fill in the missing numbers in the table. Use the following questions to help fill in the missing numbers in the table: a. What is the total contribution margin? The total contribution margin is $ b. What is the total variable expense? The total variable expense is $ c. How many units were sold? units were sold. d. What is the per-unit variable expense? The per-unit variable expense is $ e. What is the per-unit contribution margin? The per-unit contribution margin is $ Now fill in the missing numbers in the table. (Enter the percentages as whole numbers, "XX") Total Per Unit % Sales $ 120,000 $ 40 % Variable expenses % Contribution margin % Fixed expenses 13,500 $ 16,500 Operating income Requirement 2. Answer the following questions about breakeven analysis: a. What is the breakeven point in units? Begin by identifying the formula to compute the breakeven point in units. + (2) )/ (3) = Breakeven sales in units The breakeven point in units is b. What is the breakeven point in sales dollars? Begin by identifying the formula to compute the breakeven point in sales dollars. (4) (5) (6) Breakeven sales in dollars The breakeven point in sales dollars is $ Requirement 3. Answer the following questions about target profit analysis and safety margin: a. How many units must the company sell in order to earn a profit of $54,000? The company must sell units in order to earn a profit of $54,000. b. What is the current margin of safety in units? Begin by identifying the formula to compute the current margin of safety in units. (7) (8) Margin of safety in units The current margin of safety in units is c. What is the margin of safety in sales dollars? Begin by identifying the formula to compute the margin of safety in dollars. (9) (10) Margin of safety in dollars The margin of safety in dollars is $ d. What is the margin of safety in percentage? Begin by identifying the formula to compute the margin of safety in percentage. Margin of safety as a percentage of budgeted sales (11) (12) (Round the percentage to the nearest tenth percent, X.X%.) The margin of safety percentage is 1: Data Table Total Per Unit % Sales 120,000 $ 40 ? ? Variable expenses 2 Contribution margin ..... 13,500 Fixed expenses $ Operating income....... 16,500 2: Requirements 1. Fill in the missing numbers in the table. Use the following questions to help fill in the missing numbers in the table: a. What is the total contribution margin? b. What is the total variable expense? c. How many units were sold? d. What is the per-unit variable expense? e. What is the per-unit contribution margin? 2. Answer the following questions about breakeven analysis: a. What is the breakeven point in units? b. What is the breakeven point in sales dollars? 3. Answer the following questions about target profit analysis and safety margin: a. How many units must the company sell in order to earn a profit of $54,000? b. What is the current margin of safety in units? c. What is the margin of safety in sales dollars? d. What is the margin of safety in percentage? (3) (1) O O Contribution margin per unit O Contribution margin ratio O Fixed expenses Operating income O Units sold O Variable expenses (2) O O Contribution margin per unit O Contribution margin ratio O Fixed expenses Operating income O Units sold O Variable expenses O Contribution margin per unit O Contribution margin ratio Fixed expenses o Operating income O Units sold O Variable expenses (4) O O Contribution margin per unit O Contribution margin ratio O Fixed expenses Operating income O Units sold O Variable expenses Operating income O Units sold O Variable expenses (5) O O Contribution margin per unit O Contribution margin ratio Fixed expenses O Sale price per unit O Variable cost Operating income O Units sold O Variable expenses O Sale price per unit O Variable cost (6) O O Contribution margin per unit O Contribution margin ratio Fixed expenses (7) O O Breakeven sales in units O Budgeted sales in units O Fixed cost (8) O O Breakeven sales in units O Budgeted sales in units O Fixed cost (12) (9) O O Sale price per unit O Breakeven sales in dollars O Variable cost O Budgeted sales in dollars O Fixed cost (10) O O Sale price per unit O Breakeven sales in dollars O Variable cost O Budgeted sales in dollars O Fixed cost (11) O O Breakeven sales in dollars O Budgeted sales in dollars O Fixed cost Margin of safety in dollars O Sale price per unit O Variable cost O Breakeven sales in dollars O Budgeted sales in dollars O Fixed cost O Margin of safety in dollars O Sale price per unit O Variable cost
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started