Tyrene Products manufactures recreallonal equipment, The operaling resuits for the most recent year for one of its prodicts, at skateboatd, are presented below. Management is armioes to maintain and perhaps even improve its present level of income trom the skateboardh: Required: 1.6. The compary's break-even point for the most recent yoar was 54,400 units. Compute the CM per skatehoard. (Do not round intermedinte calculations.) f.b. Compute the selling price and variable expenses per skateboard. (Po not round intermediate calculations. Round your anpwern to 2 decimal pioces.) 1-b. Compute the selling price and variable expenses per skateboard, (Do not round intermedinte caiculntions. Round your answers to 2 decimal plinces.) 1-e. Compule the number of skateboards sold in the most recent year. (Do not round intermediate calculations.) 1-d. Conngade the degree of opetating leverage at the level of sales that you computed in Requirement (ic). 2. Due to an increvase in labour rates. the convany estinates that varlable expenses wit incrase by $7 og per skatebond poxt your If this chanpe takes place and the selling price per skateboard remains constant, what walb be the new CM ratio and the inew breake eveit point in skateboards? (Do not reund intermedinte calculotions.) 3. Aeler to the data in. Requicement (2) above. If the expected change in varlable costs takes place, how mary skateboards will have fo be sold next year to earn the same net operating income. $204,000, as in the most recent year? (Do net round intermediate calculosiens. 4. Refer again to the data in Requarement (2) above. The president has decided that the compary may have to rabe the seaing peice of its skateboards. II Jyrene Products wants to maintain the same CM ratio as last year, what selling price per skateboard meist it chavge nece year to cover the increased labour costs? (Do not round intermedinte colculotions. Pound your answer to 2 decimal pinces) 5. Refer to the original data. The company is considering the construction of a new, automated plant, The new plant would iesult in the contribution margin per unit increasing by 60%, but it would cause fixed costs to increase by 90%. If the new plant is buit, what would be the company's new CM ratio and new break-even point in skateboards? (Do not round intermediate caiculetions) 6. Refer to the data in Requlrement (5) above. a. If the new plant is bult, how many skateboards will have to be sold next year to eam the same net operating income. 5204.000. as last year? (Do not round intermediate calculations.) b-1. Assume that the new plant is constructed and that next year the company manufactures and sells the same number of skateboards as sold in the most recent year. Prepare a contribution format income statement. (Do not round intermediate b-1. Assume that the new plant is constructed and that next year the company manufactutes and setis ffe same number of skateboards as sold in the most recent year. Prepare a contibution format income shatement. (Oo not round intermediore colculations.) b-2. Campute the degree of operating leverage. (Do not round intermediote colculotions.)
