Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

QUESTION 1 10 points Save Answer Company XYZ sell product A. The selling price and variable cost per unit of product A are $85 and

image text in transcribed
QUESTION 1 10 points Save Answer Company XYZ sell product A. The selling price and variable cost per unit of product A are $85 and $30, respectively. The company's total fixed cost and tax rate are $297,000 and 20 percent, respectively. The company is currently selling 9,000 units per year. a What is the margin of safety (in dollars)? b. What is the degree of operating leverage? 6. If the company can increase sales by 30 percent, what percentage increase will it experience in income? d. How much revenue is needed to earn an after-tax profit of $191,1007 e. If the variable cost is considered 40 percent of sales and the fixed cost is $297,000, by how much must the annual sales increase to have a pre-tax income equal to 30 percent of sales

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Accounting questions