Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Joyce Murphy runs a courier service in downtown Seattle. She charges clients $0.60 per mile driven. Joyce has determined that if she drives 2,700

image text in transcribedimage text in transcribedimage text in transcribed

Joyce Murphy runs a courier service in downtown Seattle. She charges clients $0.60 per mile driven. Joyce has determined that if she drives 2,700 miles in a month, her total operating cost is $779. If she drives 4,400 miles in a month, her total operating cost is $983. Joyce has used the high-low method to determine that her monthly cost equation is total monthly cost $455+ $0.12 per mile driven. Required: 1. Determine how many miles Joyce needs to drive to break even. 2. Caleulate Joyce's degree of operating leverage if she drives 4,600 miles. 3,Suppose Joyce took a week off and her sales for the month decreased by 25 percent. Using the degree of operating leverage, calculate the effect this will have on her profit for that month. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine how many miles Joyce needs to drive to break even. Note: Round your intermediate calculations to 2 decimal places and final answer to the nearest whole number. Break-Even Units Miles Required 1 Required 2 > Required: 1. Determine how many miles Joyce needs to drive to break even. 2. Calculate Joyce's degree of operating leverage if she drives 4,600 miles. 3,Suppose Joyce took a week off and her sales for the month decreased by 25 percent. Using the degree of operating leverage, calculate the effect this will have on her profit for that month. Complete this question by entering your answers in the tabs below. Required 1 Reqpired 2 Required 3 Calculate Joyce's degree of operating leverage if she drives 4,600 miles. Note: Round your intermediate calculations to 2 decimal places and final answer to 4 decimal places. Degree of Operating Leverage < Required 1 Required 3 > Required: 1. Determine how many miles Joyce needs to drive to break even. 2. Caleulate Joyce's degree of operating leverage if she drives 4,600 miles. 3,Suppose Joyce took a week off and her sales for the month decreased by 25 percent. Using the degree of operating leverage, calculate the effect this will have on her profit for that month. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Suppose Joyce took a week off and her sales for the month decreased by 25 percent. Using the degree of operating leverage, calculate the effect this will have on her profit for that month. Note: Round your intermediate calculations and final answer to 4 decimal places. (I.e. 0.123456 should be entered as 12.3456%.) < Required 2 Required 3> Show less A

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

Step: 3

blur-text-image

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

Cost Accounting A Managerial Emphasis

Authors: Charles T. Horngren, Srikant M.Dater, George Foster, Madhav

13th Edition

8120335643, 136126634, 978-0136126638

More Books

Students also viewed these Accounting questions

Question

=+ Are these elements tangible or intangible?

Answered: 1 week ago

Question

=+b) Cut the runs to 8 by testing only in hot water.

Answered: 1 week ago

Question

Question 21 of 33

Answered: 1 week ago