Question
The following is Alsatia Corporations contribution format income statement for last month: Sales 1,400,000 Less variable expenses 900,000 Contribution margin 500,000 Less fixed expenses 300,000
The following is Alsatia Corporations contribution format income statement for last month:
Sales 1,400,000
Less variable expenses 900,000
Contribution margin 500,000
Less fixed expenses 300,000
Net Income 200,000
The company has no beginning or ending inventories and produced and sold 10,000 units during the month
A. what is the company's contribution margin ratio?
b. what is the company's break even in units?
c. if sales increase by 100 units, by how much should net income increase?
d. how many units would the company have to sell to attain target profits of $225,000
e. What is the company's margin of safety in dollars
f. what is the company degree of operating leverage
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started