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Vancouver's Steel Parts produces parts for the automobile industry. The company has monthly fixed expenses of $540,000 and a contribution margin of 70% of revenues.
Vancouver's Steel Parts produces parts for the automobile industry. The company has monthly fixed expenses of $540,000 and a contribution margin of 70% of revenues. Requirements 1. Compute Vancouver's Steel Parts' monthly break-even sales in dollars. Use the contribution margin ratio shortcut approach. 2. Use the contribution margin ratio to project operating income (or loss) if revenues are $880,000 and if they are $1,500,000 3. Do the results in Requirement 2 make sense given the break-even sales you computed in Requirement 1? Explain. Requirement 2. Use the contribution margin ratio to project operating income (or loss) if revenues are $880,000 and if they are $1,500,000. Complete the operating income projection by first selecting the labels. Then, project operating income (or loss) if revenues are $880,000. In the next step, complete the operating income projection for revenues at $1,500,000. (Enter losses with a minus sign or parentheses. Enter ratios as decimals.) Vancouver's Steel Parts Operating Income Projections at Different Sales Levels Operating income (loss) Requirement 3. Do the results in Requirement 2 make sense, given the break-even sales you computed in Requirement 1? Explain. Since $880,000 is the break-even point sales in dollars, it makes sense there is an operating Revenues of $1,500,000 would lead to a
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