Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following is Alsatian corporation's contribution format income statement for last month: Sales...............................$1,400,000 Variables expenses..............900,000 Contribution Margin..............500,000 Fixed expenses....................300,000 Net Operating income......$ 200,000 The company

The following is Alsatian corporation's contribution format income statement for last month:

Sales...............................$1,400,000

Variables expenses..............900,000

Contribution Margin..............500,000

Fixed expenses....................300,000

Net Operating 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 operating 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 degree of operating leverage?

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

Fraud Analytics Using Descriptive Predictive And Social Network Techniques A Guide To Data Science For Fraud Detection

Authors: Bart Baesens, Veronique Van Vlasselaer, Wouter Verbeke

1st Edition

1119133122, 978-1119133124

More Books

Students also viewed these Accounting questions

Question

List the factors that increase or decrease resource demand.

Answered: 1 week ago