Test: Lesson 5 Homework Submit T This Question: 20 pts 3 of 5 (0 complete) This Test: 50 pts poss Requirements Allen Company sells flags with team logos. Allen has fixed costs of $270,000 per year plus variable costs of $6.00 per flag. Each flag sells for $15.00. Read the requirements Requirement 1. Use the equation approach to compute the number of flags Allen must sell each year to break even. First, select the formula to compute the required sales in units to break even. Target profit 1. Use the equation approach to compute the number of flags Allen must sell each year to break even. 2. Use the contribution margin ratio approach to compute the dollar sales Allen needs to earn $9,000 in operating income for the year. (Round the contribution margin ratio to two decimal places.) 3. Prepare Allen's contribution margin income statement for the year ended December 31, for sales of 20,000 flags. (Round your final answers up to the next whole number.) 4. The company is considering an expansion that will increase fixed costs by 30% and variable costs by $1.50 per flag. Compute the new breakeven point in units and in dollars. Should Allen undertake the expansion? Give your reasoning. (Round your final answers up to the next whole number.) Rearrange the formula you determined above and compute the required number of flags to break even. The number of flags Allen must sell each year to break even is Requirement 2. Use the contribution margin ratio approach to compute the dollar sales Allen needs to earn $9,000 in operating income for the year. (Round the con Begin by showing the formula and then entering the amounts to calculate the required sales dollars to earn $9,000 in operating income. (Round the required sales in Abbreviation used: CM = contribution margin.) Print Done = Required sales in dollars % Requirement 3. Prepare Allen's contribution margin income statement for the year ended December 31, for sales of 20,000 flags. (Round your final answers up to the next whole number.) (Use parentheses or a minus sign for an operating loss.) Allen Company Contribution Margin Income Statement Year Ended December 31, 20XX Choose from any list or enter any number in the input fields and then continue to the next question. Requirements Allen Company sells flags with team logos. Allen has fixed costs of $270,000 per year plus variable costs of $6.00 per flag. Each flag sells for $15.00. Read the requirements Year Ended December 31, 20XX 1. Use the equation approach to compute the number of flags Allen must sell each year to break even 2. Use the contribution margin ratio approach to compute the dollar sales Allen needs to earn $9,000 in operating income for the year. (Round the contribution margin ratio to two decimal places.) 3. Prepare Allen's contribution margin income statement for the year ended December 31, for sales of 20,000 flags. (Round your final answers up to the next whole number.) 4. The company is considering an expansion that will increase fixed costs by 30% and variable costs by $1.50 per flag. Compute the new breakeven point in units and in dollars. Should Allen undertake the expansion? Give your reasoning. (Round your final answers up to the next whole number.) Operating Income (Loss) Requirement 4. The company is considering an expansion that will increase fixed costs by 30% and variable costs by $1.50 per flag. Compute the new breakeven (Round your final answers up to the next whole number.) (Use the equation approach.) Begin by selecting the formula to compute the required sales in units to break even under the expansion plan. Print Done Target profit Rearrange the formula you determined above and compute the required number of flags to break even under the expansion plan. Under the expansion plan, the breakeven point in units would be flags. Under the expansion plan, the breakeven point in dollars would be Should Allen undertake the expansion? Give your reasoning. Allen should only undertake the expansion if expected profits from the expansion the expected costs. Choose from any list or enter any number in the input fields and then continue to the next question. The Round Clock Company sells a particular clock for $70. The variable costs are $14 per clock and the breakeven point is 280 clocks. The company expects to sell 330 clocks this year. If the company actually sells 460 clocks, what effect would the sale of additional 130 clocks have on operating income? Explain your answer. The sale of an additional 130 clocks would operating income by the amount of The total effect would amount to Question Help Wally Waters expects to sell one individual ticket for every four family tickets. Wally Waters' total fixed costs are $122,500. Wally Waters Swim Park sells individual and family tickets. With a ticket, each person receives a meal, three beverages, and unlimited use of the swimming pools. Wally Waters has the following ticket prices and variable costs for the year: (Click the icon to view the data.) Requirements - X Individual Family Total 1. Compute the weighted average contribution margin per ticket. 2. Calculate the total number of tickets Wally Waters must sell to break even. 3. Calculate the number of individual tickets and the number of family tickets the company must sell to break even. Contribution margin Print Done Weighted average contribution margin per unit Requirement 2. Calculate the total number of tickets Wally Waters must sell to break even. Start by selecting the formula and entering the amounts to calculate the total number of tickets Wally Waters must sell to break even. (Abbreviations zero value, enter "0".) all input fields. For items with a Data Table = Required sales in units Requirement 3. Calculate the number of individual tickets and the number of family tickets the company must sell to break even. Individual Family $ 20 $ 60 = Breakeven sales of tickets Sale price per ticket Variable cost per ticket 5 20 Individual X Family - Print Done Choose from any list or enter any number in the input fields and then continue to the next