Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Keeping all other data the same as in the original example, change the targeted operating income goal for the quarter, units sold for January and

Keeping all other data the same as in the original example, change the targeted operating income goal for the quarter, units sold for January and February, and price per unit and variable expense per unit for all three months to match the information below Targeted operating income for the quarter = $12,500 Income Statement Units Sold Price per unit Variable expense per unit January February March 1,250 1,000 $ 6.00 $ 6.00 $ 2.00 $ 2.00 $6.00 $2.00 Required: 2a. Using Goal Seek in Excel, determine the total number of units Jim needs to sell in March in order to meet his targeted operating income for the quarter. (Round your answer up to the nearest unit.) Total number of units to sell in March 2b. If the company increases the price per unit by $2.00 for March only, what is the minimum number of units that Jim needs to sell in order to meet his targeted operating income for the quarter? (Round your answer up to the nearest unit.) 2b. If the company increases the price per unit by $2.00 for March only, what is the minimum number of units that Jim needs to sell in order to meet his targeted operating income for the quarter? (Round your answer up to the nearest unit.) Total number of units to sell in March after price increase 2c. Assume that Jim met his target net operating income of $12,500 and will now receive a $1,250 bonus. Jim plans to use his bonus as a down payment on a car that costs $22,800. Using the PMT function, determine the monthly payment for his new car loan. (Round your answer to 2 decimal places.) Monthly Payment 2d. Jim decides to wait to buy his car until he has a larger down payment. He wants to determine what his monthly payment would be if he earned a full year of quarterly bonuses. Assuming Jim received the same quarterly bonus for all four quarters during the year that was based on the net operating income goals described above. Determine his total bonuses earned for the year, the new loan amount and the new monthlu naumont (Daund unur manthlu naumant anewar to 2 decimal alaras Daund all other aneware tn the Monthly Payment 2d. Jim decides to wait to buy his car until he has a larger down payment. He wants to determine what his monthly payment would be if he earned a full year of quarterly bonuses. Assuming Jim received the same quarterly bonus for all four quarters during the year that was based on the net operating income goals described above. Determine his total bonuses earned for the year, the new loan amount, and the new monthly payment. (Round your monthly payment answer to 2 decimal places. Round all other answers to the nearest whole dollar.) Total bonuses earned in one year New loan amount New monthly payment Use the Goal Seek function in Excel to solve for the missing value for March Units Sold in the Income Statement. After running the Goal Seek function, verify that the amounts match the example below for the first two requirements. Total number of units to sell in March Total number of units to sell in March after price increase 2,313 1,850 Check your worksheet setup and formulas by changing the variable expense per unit to $0.75 in cells C14, D14, and E14 in the Data area, keeping all of the other date the same as in the original example. If your worksheet is operating properly, the operating income for the entire quarter should be $16,266. Note: If you rounded up the units sold for March to the nearest whole unit, the operating income will be $16,268 due to rounding If you did not get these answers, reset the Variable expense per unit back to $100 and redo the Goal Seek function. Be sure that you are referencing cell F22 es the "Set cell" for the targeted operating income of $15,000. The last two requirements can be calculated using the PMT formula and other basic Excel functions. Your monthly payment in Requirement C should be $534.57 and the new monthly payment in Requirement D should be $450.17

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

Wiley Gaap Interpretation And Application Of Generally Accepted Accounting Principles 2009

Authors: Barry J. Epstein, Ralph Nach, Steven M. Bragg

1st Edition

0470286067, 978-0470286067

More Books

Students also viewed these Accounting questions