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Q1. Delta enterprises reports the following for the single product that it sold in 2010: Selling price $ 10.00 per unit. Direct material $ 2.00
Q1. Delta enterprises reports the following for the single product that it sold in 2010: Selling price $ 10.00 per unit. Direct material $ 2.00 per unit Direct labor $ 1.50 per unit Variable manufacturing overhead $ 1.00 per dollar of direct material Factory Depreciation (fixed) 33 3,000 Other Fixed manufacturing Overhead $ 4,000 Variable selling costs $ 0.50 per unit. Non-Factory Depreciation (xed) $ 1,000 Fixed Selling and admin. expenses $ 2,000 Required: 1. What was Delta's per unit contribution margin for 2010? 2. What was Delta's contribution margin ratio for 2001? 3. If Delta sells the same product in 2011, and all parameters stay the same, what sales revenue should Delta generate to break even? The tax rate is 30%. 4.1f Delta sells the same product in 2011, and all parameters stay the same, what sales revenue should Delta generate to report net income after tax of $21,000? The tax rate is 30%. 5. What is the Degree-of-Operating Leverage (DOL) at the sales level in 4 above? Leave the answer as a fraction rather than as a decimal. 6. Using the DOL to get your answer, what will Delta's Net Income after tax be if sales volume decreases 30% from the level in 4 above
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