Below is information from Omicron Company's most recent income statement.Sales$500,000300,000Variable ExpensesContribution Margin $200,000Annual fixed expenses are $70,000 and Omicron sold 20,000 units. If, in the currentperiod, fixed expenses are expected to decrease by $10,000 and unit sales decrease by10%, the change in net operating income will be:a.b.C.d.$10,000 decrease$20,000 decrease$30,000 decrease$10,000 increase

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Variable costs as a percentage of sales for Lemon Inc. are 66%, current sales are $534,000, and fixed costs are $188,000. How much will operating income change if sales increase by $49,900? a. $32,934 decrease b. $16,966 decrease c. $32,934 increase d. $16,966 increase
Philip Inc. has provided the following data: Data Table Accounts Amounts Sales per unit $120 Variable cost per unit $40 Fixed costs $280,000 Units sold 10,000 How much will operating income change if sales increase by $600,000? (Do not round intermediate calculations) Group of answer choices $420,000 increase $420,000 decrease $200,000 increase $400,000 increase
11. Subject:-Accounting
Variable costs as a percentage of sales for Lemon Inc. are 73%, current sales are $647,000, and fixed costs are $190,000. How much will operating income change if sales increase by $37,200? a. $10,044 increase b. $27,156 increase c. $27,156 decrease d. $10,044 decrease
Leete Inc. reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income 14.000.000 9.660.000 4,340,000 3,620,000 720,000 The Company's average operating assets were $8,000,000. It's minimum required return was 8%. 1. What is the company's margin percentage? 2. What is the company's turnover? 3. What is the company's return on investment? 4. What is the company's residual income?
Following is the last year data of X company: Selling price Variable expenses per unit $40 unit $80 per Fixed expenses for the year $180,000 The company sold 45,000-unit last year. Managers of X company believes that the sales can be doubled when expenditure on advertising is increased by $1.50 per unit, keeping the selling price same as last year. Determine the amount by which advertising can be increased with profits remaining unchanged? a. $1,665,000 b. $1,800,000 c. $1,500,000 d. $1,660,000
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Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income Average operating assets At the beginning of this year, the company has a $300,000 investment opportunity with the following cost and revenue characteristics: Sales Contribution margin ratio Fixed expenses $1,400,000 680,000 720,000 440,000 $ 280,000 $ 875,000 $ 480,000 $ 336,000 The company's minimum required rate of return is 15%. Residual income 80% of sales 13. If the company pursues the investment opportunity and otherwise performs the same as last year, what residual income will it earn this year?
Required information [The following information applies to the questions displayed below.] Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses $ 1,600,000 700,000 900,000 660,000 Net operating income 24 240,000 Average operating assets $1,000,000 At the beginning of this year, the company has a $325,000 investment opportunity with the fol characteristics: $ 520,000 Sales Contribution margin ratio Fixed expenses 70 % of sales $ 312,000 The company's minimum required rate of return is 15%. 4. What is the margin related to this year's investment opportunity? Margin % ( Prev Ps Ai Pr re to search
ra subject-Accounting
Accounting Gosnell Company produces two products: squares and circles. The projected income for thecoming year, segmented by product line, follows:Squares Circles TotalSales P300,000 P2,500,000 P2,800,000Less: Variable expenses 100,000 500,000 600,000Contribution margin P200,000 P2,000,000 P2,200,000Less: Direct fixed expenses 28,000 1,500,000 1,528,000Product margin P172,000 P 500,000 P 672,000Less: Common fixedexpenses100,000Operating expenses P 572,000The selling prices are P30 for squares and P50 for circles.1. Compute the number of units of each product that must be sold for Gosnell Companyto break even.2. Assume that the marketing manager changes the sales mix of the two products sothat the ratio is three squares to five circles. Repeat Requirement 13. Refer to the original data. Suppose that Gosnell can increase the sales of squares withincreased advertising. The extra advertising would cost an additional P45,000, andsome of the potential purchasers of circles would switch to…
Larger Company had originally expected to earn operating income ofPhp130,000 in the coming year. Its degree of operating leverage is 2.4.Recently, larger revised its plan and now expects to increase sales by 20%next year. What is the percentage change in operating income for thecoming year? a. 8.33%b. 48.00%c. 20.00%d. 54.17%

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