need answers 5-8
Units 360,000 Break Even point question Income statement of manufacturing operations Sales Variable cost Contribution Murgin Fixed Expenses Net profit 7.500.000 3.500.000 4,000,000 2.500,000 1,500,000 Calculate the sale price Card Vanalaprill 2 Cable the case Calculate the sepany's B & dollers Calline the margin of safety for this company Banal Sales - SSL Assume that 52.100,000 profitest yet How many production is to read this post What is the operating leveres in allen Sale inerente by wch The creary present harmides impresiastices and all The belines that increasing marketing espese by 100.000 and get dolore mm will surels by 10,000. What should they de Next year we told competidling prices will Management wants to mider meer as this year $15 March the same. How many time all this pal? 11 m Cost Volume Profit Formulas 1. Sales - Variable Expenses - Contribution Margin 1a. Selling Price per Unit - Variable Expenses per Unit = CM per Unit 2. Breakeven point in Units Fixed Expenses CM/unit Breakeven point in Dollars = BE Units X Selling Price per Unit Breakeven point in Dollars - Fixed Expenses CM Ratio 5. Contribution Margin Ratio - CM Sales Sales - Variable expenses - Fixed Expenses = Operating Profit (income) 6a. S - VE - CM; CM - Fixed - Operating Profit (Income) Target Sales in Units - Fixed Expenses + Target Operating Profit CM/unit 8. Target Sales in Dollars - Fixed Expenses + Target Operating Profit CM ratio 9. Operating Leverage = Net income 10. Safety Margin= Budgeted Sales - Breakeven Sales CM SOLUTION: 1. Sales price per unit = Sales / units sold = 7500000 / 360000 = $20.83 per unit Contribution margin per unit = Contribution margin/ Units sold = 4000000/360000 = $11.11 per unit Variable expense per unit = Variable expenses / units sold = 3500000 / 360000 = $9.72 2. Contribution margin ratio = Contribution margin / Sales = 4000000 / 7500000 = 0.5333 or 53.33% 3. Breakeven point in units (BEP) = Fixed Costs/ Contribution margin per unit = 2500000 / 11.11 = 225023 units (rounded) Breakeven point in dollars = Fixed Costs / Contribution margin ratio = 2500000 / 53.33% = $4687793 (rounded) 4. Margin of safety = Total Actual sales - Breakeven sales = 7,500,000 - 4,687,793 = $2,812,207 AS PER CHEGG'S POLICY, ONLY FIRST FOUR SUBPARTS ARE NEEDED TO BE ANSWERED. PLEASE POST THE OTHER SUBPARTS SEPARATELY TO GET ANSWERED. PLEASE LIKE (UPVOTE). Units 360,000 Break Even point question. Income statement of manufacturing operations Sales Variable cost Contribution Margin Fixed Expenses Net profit $ 7,500,000 3,500,000 4,000,000 2,500,000 1,500,000 Calculate the Sales price, Contribution margin and Variable Expenses (all per unit). 2 Calculate the company's contribution margin ratio 3 Calculate the company's BEP in units & dollars. 4 Calculate the margin of safety for this company. Budgeted Sales - $8,500,000 5 Assume that management wants a $2,000,000 profit next year. How many production units must be sold to reach this goal? What is the operating leverage in dollars and %? If Sales increase by 5% how much will net income increase? 7 The company president has an idea to improve operations and sales. He believes that increasing marketing expense by $100,000 and offering an extra 2 dollars sales commission will increase number of units by 10,000. What should the company do? 8 Next year due to increased competition selling prices will drop 5%. Management wants to maintain the same net profit as this year ($1.5 Mill). Assuming all other costs are the same, How many units must be sold to reach this goal? Cost Volume Profit Formulas 1. Sales - Variable Expenses = Contribution Margin 1a. Selling Price per Unit - Variable Expenses per Unit = CM per Unit 2. Breakeven point in Units = Fixed Expenses CM/unit 3. Breakeven point in Dollars = B/E Units x Selling Price per Unit 4. Breakeven point in Dollars - Fixed Expenses CM Ratio 5. Contribution Margin Ratio = CM Sales 6. Sales - Variable expenses - Fixed Expenses = Operating Profit (income) 6a. S - VE = CM; CM - Fixed = Operating Profit (Income) 7. Target Sales in Units = Fixed Expenses + Target Operating Profit CM/unit 8. Target Sales in Dollars = Fixed Expenses + Target Operating Profit CM ratio 9. Operating Leverage = CM Net income 10. Safety Margin = Budgeted Sales - Breakeven Sales SOLUTION: 1. Sales price per unit = Sales / units sold = 7500000/360000 = $20.83 per unit Contribution margin per unit = Contribution margin/ Units sold = 4000000 / 360000 = $11.11 per unit Variable expense per unit = Variable expenses / units sold = 3500000 / 360000 = $9.72 2. Contribution margin ratio = Contribution margin / Sales = 4000000 / 7500000 = 0.5333 or 53.33% 3. Breakeven point in units (BEP) = Fixed Costs/ Contribution margin per unit = 2500000 / 11.11 = 225023 units (rounded) Breakeven point in dollars = Fixed Costs / Contribution margin ratio = 2500000 / 53.33% = $4687793 (rounded) 4. Margin of safety = Total Actual sales - Breakeven sales = 7,500,000 - 4,687,793 = $2,812,207 AS PER CHEGG'S POLICY, ONLY FIRST FOUR SUBPARTS ARE NEEDED TO BE ANSWERED. PLEASE POST THE OTHER SUBPARTS SEPARATELY TO GET ANSWERED. PLEASE LIKE (UPVOTE). Unit 360,000 Break Even point question lascome stematofantasiestuations Sales Variable cost Contribution Margie Fixed Expenses Net profit 7.500,000 3.500.000 4.000.000 2.500.000 1.500.000 calculate the sales prieks call them Calitatea Cele themes of life comparede Athama2.2008 www.madhe What the poing Selim De perspreide handen pertama eves the magnetningene 500.000 de encomalee by hedder Sel pes de competitie clips Met wat hy SMER m
