Question
The following is Acadia Corporation's contribution format income statement for last month: Sales $1,200,000 Variable expenses 800,000 Contribution margin 400,000 Fixed expenses 300,000 Net operating
The following is Acadia Corporation's contribution format income statement for last month: Sales $1,200,000 Variable expenses 800,000 Contribution margin 400,000 Fixed expenses 300,000 Net operating income $100,000 The company has no beginning or ending inventories and produced and sold 20,000 units during the month. ~ Calculate the company's contribution margin ratio. ~ Calculate the company's break-even in units. ~ Calculate the impact if sales increase by 100 units, on net operating income. ~ Calculate how many units the company have to sell to attain a target profit of $125,000. ~ Calculate the company's margin of safety in dollars. ~ Calculate the company's degree of operating leverage.
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