Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Required Information [The following information applies to the questions displayed below.] Henna Co. produces and sells two products. T and O. It manufactures these products

image text in transcribed

image text in transcribed

image text in transcribed

Required Information [The following information applies to the questions displayed below.] Henna Co. produces and sells two products. T and O. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 45,000 units of each product. Sales and costs for each product follow. Producto $ 787 See 28.750 208756 Sales Variable costs Contribution margin Fixed costs Income before taxes Income taxes (48% rate) Net income Product $ 787 See 551 25e 236, 25e 111.250 125,89e 50.000 $75.89e Required: 1. Compute the break-even point in dollar sales for each product. (Enter CM ratlo as percentage rounded to 2 decimal places.) Product T Contribution Margin Ratio Choose Numerator Choose Denomi Contribution Margin Ratio Contribution margin ratio Break-Even Point in Dollars Choose Numerator Choose Denominator. Break-Even Point in Dollars Break-even point in dollars Producto Contribution Margin Ratio Contribution margin ratio Break-Even Point in Dollars Break-even point in dollars 2. Assume that the company expects sales of each product to decline to 28 000 units next year with no change in unit selling price. Prepare forecasted financial results for next year following the format of the contribution margin income statement as just shown with columns for each of the two products lassume 40% tax ratel Also, assume that any loss before taxes yields a 40% tax benefit. (Round "per unit" answers to 2 decimal places. Enter losses and tax benefits. If any, as negative values.) Forecasted Contribution Units Per unit Sie Contribution margin Net income fosse 3. Assume that the company expects sales of each product to increase to 59.000 units next year with no change in unit selling price. Prepare forecasted financial results for next year following the format of the contribution margin income statement shown with columns for each of the two products assume a 40% tax rate). (Round "per unit" answers to 2 decimal places Forecasted Contribution Units Peru Contribution margin Net income (loss)

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

Step: 3

blur-text-image

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

The Partnership And Alliances Audit

Authors: David Connell, Peter J. LaPlaca, Kenneth Wexler

1st Edition

1907766065, 978-1907766060

More Books

Students also viewed these Accounting questions