Please I need help on this questions. i dont know what the policy says on how many questions you can answer but please do wherever questions you can. thank you
Cheryl Montoya picked up the phone and called her boss, Wes Chan, the vice president of marketing at Piedmont Fasteners Corporation: "Wes, I'm not sure how to go about answering the questions that came up at the meeting with the president yesterday." "What's the problem?" "The president wanted to know the break-even point for each of the company's products, but I am having trouble figuring them out." "I'm sure you can handle it, Cheryl. And, by the way, I need your analysis on my desk tomorrow morning at 8:00 sharp in time for the follow-up meeting at 9:00." Piedmont Fasteners Corporation makes three different clothing fasteners in its manufacturing facility in North Carolina. Data concerning these products appear below: Velcro Metal Nylon Annual sales volume 104.000 198.000 292,000 Unit selling price 2.30 $ 2.00 1.20 Variable expense per unit $0.90 51.30 Total fixed expenses are $262.000 per year. All three products are sold in highly competitive markets, so the company is unable to raise prices without losing an unacceptable The company has an extremely effective lean production system, so there are no beginning or ending work in process or finished goods inventories Required: 1. What is the company's over-all break-even point in dollar sales? 2. Of the total fixed expenses of $262,000, $30,800 could be avoided if the Velcro product is dropped, S111,300 if the Metal product is dropped, and $38,800 if the Nylon product is dropped. The remaining fixed expenses of $81,100 consist of common fixed expenses such as administrative salaries and rent on the factory building that could be avoided only by going out of business entirely. a. What is the break-even point in unit sales for each product? b. If the company sells exactly the break-even quantity of each product, what will be the overall profit of the company? Complete this question by entering your answers in the tabs below. Required 1 Required 2A Required 20 of the total fixed expenses of $262,000, $30,800 could be avoided if the Velcro product is dropped, $111,300 if the Metal product is dropped, and $30,000 if the Nylon product is dropped. The remaining fixed expenses of $81,100 consist of common fived evnenses such as administrative salaries and rent on the factory buildinn that could he avoided only hy noin Feather Friends, Inc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and fixed expenses total $200,000 per year. Its operating results for last year were as follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income $2,000,000 1,040,000 1,040,000 200,000 S 840,000 Required: Answer each question independently based on the original data: 1. What is the product's CM ratio? 2. Use the CM ratio to determine the break-even point in dollar sales 3. If this year's sales increase by $60,000 and fixed expenses do not change, how much will net operating income increase? 4-a. What is the degree of operating leverage based on last year's sales? 4-6. Assume the president expects this year's sales to increase by 16%. Using the degree of operating leverage from last year, what percentage increase in net operating income will the company realize this year? 5. The sales manager is convinced that a 14% reduction in the selling price, combined with a $71.000 increase in advertising, would increase this year's unit sales by 25%. a. If the sales manager is right, what would be this year's net operating income if his ideas are implemented? b. If the sales manager's ideas are implemented, how much will net operating income increase or decrease over last year? 6. The president does not want to change the selling price. Instead, he wants to increase the sales commission by $2.30 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $840.000 net operating income as last year? Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req3 Reg 4 Reg 4B Reg SA Reg 5B Req6 The president does not want to change the selling price. Instead, he wants to increase the sales commission by $2.30 per unit. He thinks that this move, combined with some increase in advertising, would increase this year's sales by 25%. How much could the president increase this year's advertising expense and still earn the same $340,000 net operating income as last year? Show less Problem 5-21 Sales Mix; Multiproduct Break-Even Analysis [LO5-9] Gold Star Rice, Ltd., of Thailand exports Thai rice throughout Asia. The company grows three varieties of rice-White, Fragrant, and Loonzain. Budgeted sales by product and in total for the coming month are shown below: White 48 $ 302, 400 90, 720 $ 211, 680 Percentage of total sales Sales Variable expenses Contribution margin Fixed expenses Net operating income Product Fragrant Loonzain 20 32 100 $ 126,000 100 $ 201,600 100 30 100, 800 80 110,880 55 70 S 25, 200 20 $ 90, 720 45 100 Total 100 $ 630,000 302, 400 327,600 231,400 $ 96,200 52 Dollar sales to break-even Fixed expenses CM ratio $ 231, 400 0.52 $445,000 Dollar sales to break-even Fixed expenses CM ratio $231, 400 0.52 - $445,000 As shown by these data, net operating income is budgeted at $96,200 for the month and the estimated break-even sales is $445,000. Assume that actual sales for the month total $630,000 as planned. Actual sales by product are: White, $201,600; Fragrant, $252,000: and Loonzain, S176,400 Required: 1. Prepare a contribution format income statement for the month based on the actual sales data. 2. Compute the break-even point in dollar sales for the month based on your actual data, Complete this question by entering your answers in the tabs below
