Question
YUX Corporation sells a single product for $40. It's management estimates the following revenues and costs for the year 2016: Net Sales $500,000 Direct Materials
YUX Corporation sells a single product for $40. It's management estimates the following revenues and costs for the year 2016:
Net Sales $500,000
Direct Materials 150,000
Direct Labor 90,000
Manufacturing Overhead - Variable 30,000
Manufacturing Overhead - Fixed 40,000
Selling expenses - variable 20,000
Selling expenses - fixed 30,000
administrative expenses - variable 10,000
administrative expenses - fixed 20,000
A) Assuming fixed costs and net sales are spread evenly throughout the year, calculate YUX's monthly break-even point in units and dollars.
B) Calculate the contribution margin ratio, the annual margin ratio, and the annual profit
C) Assuming YUX Corporation increases its selling price by 30% and all other factors (including demand) remail constant, determind by what percentage annual profits will increase.
D) Assume the price remains at $40 per unitand variable costs remain the same per unit, but fixed costs increase by 30% annually. Calculate the percentage increase in unit sales required to acheive the same level of annual profit calculated in part b.
E) Determine the sales required to earn an operating income of $360,000 after tax. YUX Corporation's tax rate is 40%.
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