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It says to answer 1-7 but just answer what you can. thank you general conclusion might you 3, 9-5) 9-39 CVP Analysis; Profit Planning Horton
It says to answer 1-7 but just answer what you can. thank you
general conclusion might you 3, 9-5) 9-39 CVP Analysis; Profit Planning Horton Manufacturing Inc. (HMI) is suffering from the ele of increased local and global competition for its main product, a lawn mower that is sold in disco stores throughout the United States. The following table shows the results of HMI's operations to 1. Compute HMI's breakeven point in both units and dollars. Also, compute the contribution margin ratio 2019: Required Sales (12,500 units @ $84) Variable costs (12,500 @ $63) Contribution margin Fixed costs Operating profit (loss) $ 1,050,000 787,500 $ 262,500 296,100 ($ 33,600) (Round the number of units up to the next whole number.) 2. What would be the required sales, in units and in dollars, to generate a pretaz profit of $30,000? (Round the number of units up to the next whole number) 3. Assume an income tax rate of 40%. What would be the required sales voluzze, in both units and dollar to generate an after-tax profit of $30,000? (Round the number of units up to the next whole number 4. Prepare a contribution income statement as a check for your calculations in requirement 3. 5. The manager believes that a $60,000 increase in advertising would result in approximately a $200,000 increase in annual sales. If the manager is right, what will be the effect on the company's operating profit or loss? 6. Refer to the original data. The vice president in charge of sales feels that a 10% reduction in price in combination with a $40,000 increase in advertising will cause unit sales to increases by 25%. What effect would this strategy have on operating profit (loss)? 7. Refer to the original data. During the year, HMI saved $5 of unit variable cost per lawn mower by buy- ing from a different manufacturer. However, changing the plant machinery to accommodate the new part means an additional $50,000 in fixed costs per year. Was this a wise change? Why or why not Step by Step Solution
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