Question
Lamar has the following information Selling Price $40 Variable manufacturing cost $22 Fixed manufacturing cost $150,000 per month Variable selling & administrative costs $6 Fixed
Lamar has the following information
Selling Price $40
Variable manufacturing cost $22
Fixed manufacturing cost $150,000 per month
Variable selling & administrative costs $6
Fixed selling & administrative costs $120,000 per month
__________________________1. What is the expected operating profit for the upcoming year for 30,000 units forecasted?
___________________________ 2. What is the break-even point in dollars?
___________________________ 3. What is the number in units in which profits are equal to zero?
___________________________ 4. what is the contribution margin per unit?
___________________________ 5. what is the contribution margin in dollars?
___________________________ 6. How much in sales dollars is required to generate an operating profit of $30,000?
___________________________7. what is the contribution margin ratio?
___________________________ 8. How much in units is required to generate an operating profit of $24,000 after tax ( tax rate 20%)
___________________________ 9. if the forecast is 35,000 units, what is the margin of safety in units ?
___________________________10. what is the operating leverage? It is high or low?
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