Question
YUX Corporation sells a single product for $50. Its management estimates the following revenues and costs for the year 2020: Net sales $450,000 Selling expensesvariable
YUX Corporation sells a single product for $50. Its management estimates the following revenues and costs for the year 2020: Net sales $450,000 Selling expensesvariable $21,700 Direct materials 115,100 Selling expensesfixed 19,100 Direct labour 59,300 Administrative expensesvariable 9,300 Manufacturing overheadvariable 19,600 Administrative expensesfixed 10,900 Manufacturing overheadfixed 23,400
A.Assuming fixed costs and net sales are spread evenly throughout the year, determine YUXs monthly break-even point in units and dollars. (Round answers to 0 decimal places, e.g. 5,275.)
B.Calculate the contribution margin ratio, the annual margin of safety ratio, and the annual profit. (Round answers to 0 decimal places, e.g. 15 or 15%.)
C.Determine the percentage increase in annual profits if YUX Corporation increases its selling price by 20% and all other factors (including demand) remain constant. (Round answer to 2 decimal places, e.g. 15.25%.)
D.Assume the price remains at $50 per unit and variable costs remain the same per unit, but fixed costs increase by 20% annually. Calculate the percentage increase in unit sales required to achieve the same level of annual profit calculated in part (b). (Round answer to 2 decimal places, e.g. 15.25%.)
E.Determine the sales required to earn an operating income of $343,800 after tax. YUX Corporations income tax rate is 40%.
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