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please help, cery confused. Determine the amount of sales (units) that would be necessary under Break-Even Sales Under Present and Proposed Conditions Darby Company, operating
please help, cery confused.
Determine the amount of sales (units) that would be necessary under Break-Even Sales Under Present and Proposed Conditions Darby Company, operating at full capacity, sold 95,850 units at a price of $99 per unit during the current year. Its income statement for the current year is as follows: Sales $9,489,150 4,686,000 $4,803,150 Cost of goods sold Gross profit Expenses: Selling expenses $2,343,000 Administrative expenses 2,343,000 Total expenses 4,686,000 Income from operations $117,150 The division of costs between fixed and variable is as follows: Variable Fixed Cost of goods sold 70% 30% Selling expenses 75% 25% Administrative 50% 50% expenses Management is considering a plant expansion program that will permit an increase of $792,000 in yearly sales. The expansion will increase fixed costs by $79,200, but will not affect the relationship between sales and variable costs Required: 1. Determine the total variable costs and the total fixed costs for the current year. Enter the final answers rounded to the nearest dollar Required: 1. Determine the total variable costs and the total fixed costs for the current yeat Enter the final answers rounded to the nearest dollar Total variable costs 6,208,950 Total fixed costs 3,163,050 2. Determine (a) the unit variable cost and (b) the unit contribution margin for the current year. Enter the final answers rounded to two decimal places Unit variable cost 64.8 X Unit contribution margin 34.2 X 3. Compute the break-even sales (units) for the current yeat Enter the final answers rounded to the nearest whole number. 92,465.8 X units 4. Compute the break-even sales (units) under the proposed program for the following year, enter the final answers rounded to the nearest whole number 115,644.7 x units 5. Determine the amount of sales (units) that would be necessary under the proposed program te realize the $117,150 of income from operation that was named in the Current year Enter the final answers rounded to the nearest whole number 95,912.3 x units 6. Determine the maximum income from operations possible with the expanded plant, Enter the final answer rounded to the nearest dollar 7. If the proposal is accepted and sales remain at the current level, what will the income or loss from operations be for the following year? Enter the final answer rounded to the nearest dolla 8. Based on the data given, would you recommend accepting the proposal? a. In favor of the proposal because of the reduction in break even point: Cher My Work more Check My Works remaining Pro Nav! eBook B Show Me How 4. Compute the break-even sales (units) under the proposed program for the following year. Enter the final answers rounded to the nearest whole number 115,644.7 X units 5. Determine the amount of sales (unts) that would be necessary under the proposed program to realize the $117,150 of income from operations that was earned in the current year. Enter the final answers rounded to the nearest whole number 95,912.3 X units 6. Determine the maximum income from operations possible with the expanded plant. Enter the final answer rounded to the nearest dollar, 7. If the proposal is accepted and sales remain at the current level, what will the income or loss from operations be for the following year? Enter the final answer rounded to the nearest dollar 8. Based on the data given, would you recommend accepting the proposal? s. In favor of the proposal because of the reduction in break-even point. b. In favor of the proposal because of the possibility of increasing income from operations c. In favor of the proposal because of the increase in break-even point. d. Reject the proposal because if future sales remain at the current level, the income from operations will increase. e. Reject the proposal because the sales necessary to maintain the current income from operations would be below the current year sales Choose the correct answer Feedback Check My W 1. Multiply the percentages for fixed and variable costs by each cost. 2. a. Divide the total variable costs by number of units Step by Step Solution
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