FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Coney Adventures Inc. sells one product for $5. The variable cost per item is $3, and the fixed costs for the firm are $40.
- Assume that the income tax rate for Redlands is 40%. Compute the number of units and sales revenue needed to achieve an $18 net profit.
- Compute the number of units and sales revenue needed to achieve an 8% profit margin. (Ignore income taxes.)
- Compute the number of units and sales revenue needed to achieve a 12% net profit margin. (Assume a 40% income tax rate.)
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- Lablanc Inc. sells a product for $60 per unit. The variable cost is $34 per unit, while fixed cost are $108,160. Determine (a) the break-even point in sales unit (b) the break-even point if the selling price weee increases to $66 per unit.arrow_forwardLin Corporation has a single product whose selling price is $135 per unit and whose variable expense is $81 per unit. The company’s monthly fixed expense is $23,580. Required: 1. Calculate the unit sales needed to attain a target profit of $4,500. (Do not round intermediate calculations.) 2. Calculate the dollar sales needed to attain a target profit of $9,500. (Round your intermediate calculations to the nearest whole number.)arrow_forwardSuper Sales Company is the exclusive distributor for a high-quality knapsack. The product sells for $100 per unit and has a CM ratio of 40% The company's fixed expenses are $459,000 per year. The company plans to sell 12,000 knapsacks this year. Required: 1. What are the variable expenses per unit? Variable expenses per unit 2. Use the equation method for the following e. What is the break-even point in units and in sales dollars? Break-even point in units Break-even point in sales dollars b. What sales level in units and in sales dollars is required to earn an annual profit of $99,000? Sales in units Sales in dollars c. What sales level in units is required to earn an annual after-tax profit of $99,000 if the tax rate is 25%? Sales in units d. Assume that through negotiation with the manufacturer, Super Sales Company is able to reduce its variable expenses by $5 per unit. What is the company's new break-even point in units and in sales dollars? (Do not round Intermediate calculations.…arrow_forward
- Maple Enterprises sells a single product with a selling price of $87 and variable costs per unit of $26. The company's monthly fixed expenses are $15,356. What dollar sales will Maple need in order to reach a target profit of $26,540? Round to the nearest whole dollar, no decimals.arrow_forwardLindon Company is the exclusive distributor for an automotive product that sells for $50.00 per unit and has a CM ratio of 30%. The company’s fixed expenses are $345,000 per year. The company plans to sell 27,200 units this year. Required: What are the variable expenses per unit? Note: Round your "per unit" answer to 2 decimal places. What is the break-even point in unit sales and in dollar sales? What amount of unit sales and dollar sales is required to attain a target profit of $195,000 per year? Assume that by using a more efficient shipper, the company is able to reduce its variable expenses by $5.00 per unit. What is the company’s new break-even point in unit sales and in dollar sales? What dollar sales is required to attain a target profit of $195,000?arrow_forwardLablanc Inc. sells a product for $93 per unit. The variable cost is $45 per unit, while fixed costs are $516,096. Determine (a) the break-even point in sales units and (b) the break-even point if the selling price were increased to $101 per unit.arrow_forward
- 2.arrow_forwardFine Leather Enterprises sells its single product for $129.00 per unit. The firm’s fixed operating costs are $473,000 annually, and its variable operating costs are $86.00 per unit. a. Find the firm’s operating break-even point in units. b. Label the x-axis “Sales (units)” and the y-axis “Costs/Revenues ($),” and then graph the firm’s sales revenue, total operating cost, and fixed operating cost functions on these axes. In addition, label the operating break-even point and the areas of loss and profit (EBIT).arrow_forwardYusuf Company sells a product for $220 per unit. The variable cost is $170 per unit, and fixed costs are $180,000. Determine (a) the break-even point in sales units and (b) the sales units required to achieve a target profit of $56,000.arrow_forward
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