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Selling price per racket 5.40.00 $60.00 590.00 Variable expenses per racket Production 5.22.00 $ 27.80 $31.50 Selling (5% of selling price) 52.00 53.00 $4.50 All
Selling price per racket 5.40.00 $60.00 590.00 Variable expenses per racket Production 5.22.00 $ 27.80 $31.50 Selling (5% of selling price) 52.00 53.00 $4.50 All sales are made through the company's own retail outlets. The Racket Division has the following fixed costs Fixed production costs Advertising expense Administrative salaries Total Per Month 5 120,000 100,000 50,000 $ 270,000 Sales, in units over the past two months have been as follows April Hay Standard Deluxe 2.000 1.000 1.000 1.000 pra 5.900 Yata 3.000 3.000 Required: 1a. Prepare contribution format income statements for April 1- Prepate contribution format income statements for May 3. Compute the Racket Division's break-even point in dollar sales for April 4 Will the break even point would be higher or lower with May's sales mix than with April's sales mix? 5 Assume that sales of the Standard racket increase by $20,000 Wat would be the effect on net operating income? What would be the effect it Pro racket sales increased by $20000? Do not prepare income statements use the incremental analysis approach in determining your answer Selling price per racket 5.40.00 $60.00 590.00 Variable expenses per racket Production 5.22.00 $ 27.80 $31.50 Selling (5% of selling price) 52.00 53.00 $4.50 All sales are made through the company's own retail outlets. The Racket Division has the following fixed costs Fixed production costs Advertising expense Administrative salaries Total Per Month 5 120,000 100,000 50,000 $ 270,000 Sales, in units over the past two months have been as follows April Hay Standard Deluxe 2.000 1.000 1.000 1.000 pra 5.900 Yata 3.000 3.000 Required: 1a. Prepare contribution format income statements for April 1- Prepate contribution format income statements for May 3. Compute the Racket Division's break-even point in dollar sales for April 4 Will the break even point would be higher or lower with May's sales mix than with April's sales mix? 5 Assume that sales of the Standard racket increase by $20,000 Wat would be the effect on net operating income? What would be the effect it Pro racket sales increased by $20000? Do not prepare income statements use the incremental analysis approach in determining your
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