FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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- Munabhaiarrow_forwardComplete all requirements <><>arrow_forwardSunland Orthotics Company distributes a specialized ankle support that sells for $ 40. The company’s variable costs are $ 30 per unit; fixed costs total $ 320,000 each year. Calculate contribution margin ratio. Contribution margin ratio =25% If sales increase by $ 52,000 per year, by how much should operating income increase? (Use the rounded contribution margin ratio calculated in the previous part.) Change in operating income?arrow_forward
- Argyle sells steel beams to building contractors in two sizes: regular and heavy. Argyle sells 4 regular beams for every one heavy beam. Cost data are as follows: Regular Heavy Price per unit $20.00 $16.00 Variable cost per unit Argyle's fixed costs are $2,880 per month. How much is the breakeven point for total sales revenues? $28.00 $20.00 A. $12,960 B. $12,880 OC. $9,600 OD. $13,240 C...arrow_forwardFamous Productions performs London shows. The average show sells 1,300 tickets at $60 per ticket. There are 155 shows per year. No additional shows can be held as the theater is also used by other production companies. The average show has a cast of 65, each earning a net average of $340 per show. The cast is paid after each show. The other variable cost is a program-printing cost of $8 per guest. Annual fixed costs total $728,000. Read the requirements LOADING... . Requirement 1. Compute revenue and variable costs for each show. Select the formula and enter the amounts to compute sales revenue for each show. × = Sales revenue per show × = Requirements 1. Compute revenue and variable costs for each show. 2. Use the equation approach to compute the number of shows Famous Productions must perform each year to break even. 3. Use the contribution margin ratio approach to compute the number of shows…arrow_forwardWild-Water Works Water Park provides for a fun day by offering a variety of rides. Wild-Water Works Water Park sells tickets at $75 per person as a one-day entrance fee. Variable costs per person are $34 and fixed cost amount to $221,100 per month. Wild-Water Works Water Park expects to sell 7,500 tickets. Find break-even first, then compute the margin of safety in tickets and sales in dollars. Net sales revenue per unit - Variable costs per unit = Unit contribution margin 1607 + (Fixed Costs +Target Profit) / Contribution Margin per unit = Required Sales in Units = Expected Sales Break-even sales = Margin of safety in units Margin of safety in units X Sales price per unit = Margin of safety in dollars X ||arrow_forward
- Wild-Water Works Water Park provides for a fun day by offering a variety of rides. Wild-Water Works Water Park sells tickets at $79 per person as a one-day entrance fee. Variable costs per person are $33 and fixed cost amount to $131,000 per month.Wild-Water Works Water Park expects to sell 7,300 tickets. Estimate the operating income if sales increase by 15%.Calculate the degree of operating leverage.(Round your answers to two decimal places when needed and use rounded answers for all future calculations.)arrow_forwardMusicLand Theme Park has an average daily admission price of $60 per guest. The followingfinancial data are available for analysis:Daily operating fixed costs $750,000Variable daily operating cost per guest 24Average daily concession revenue per guest 30Average daily variable cost of concession items per guest 16Additional operating data indicate that the park averages 24,000 daily guests during the weekdays and 40,000 average daily guests on Saturdays and Sundays.A. Determine the break-even number of guests per day at the theme park.B. How much profit does MusicLand earn on an average weekday?C. How much profit does MusicLand earn on an average weekend day?D. Determine the revised break-even if the daily fixed costs increased to $1,000,000.E. Would the theme park still remain profitable for an average weekday under the scenarioin (D)?arrow_forwardSeved Help Save & Exit Submit A company purchases fruit from farmers for $2.00 a pound. The fruit can be sold for $3.20 a pound or it can be used to make jelly. Each case of jelly contains three-quarters of a pound of fruit and can be soid for $4.40. In addition to the cost of the fruit, making and selling each case of jelly incurs additional variable costs of $1.10 per unit. The monthly fixed costs associated with making the jelly include: O Qu Jelly production salaries Depreciation of jelly-making equipment Salary of salesperson dedicated to selling jelly $4,000 400 2,000 Total fixed costs $6,400 Colla The jelly-making equipment does not wear out through use and it has no resale value. Assuming the company makes and sells 8,000 cases of Jelly. what is the financial advantage (disadvantage) of continuing to process fruit into jelly? Multiple Choice $(5,200) $(5,600)arrow_forward
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