The section of Waterways that produces controllers for the company provided the following information.Sales for month of February:Unit variable manufacturing cost:Unit selling price:3,800$10.00$43.00Fixed manufacturing overhead cost (per month for controllers):$83,000Unit variable selling and administrative costs:$2.90Fixed selling and administrative expenses (per month for controllers): $13,950Using this information for the controllers, determine the contribution margin ratio, the degree of operating leverage, the break-even point in sales dollars, and the margin of safety ratio for WaterwaysCorporation on this product.Contribution Margin Ratio (Round to O decimal places, e.g. 25%.)70%Degree of Operating Leverage (Round to 2 decimal places, e.g. 5.25.)Break-even Point in DollarsMargin of Safety Ratio (Round to 1 decimal place, ex. 5.2%)6.56138500%SUPPORT8:34 PM3/16/2024

The contribution margin is calculated as the difference between the sales and variable costs. The…

Answered: Sales for month of February: 3,800 Unit…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Contribution Margin Income Statement For Year Ended December 31 Sales (400,000 units) Variable costs Direct materials Direct labor Variable overhead Contribution margin Fixed costs Fixed overhead Fixed general and administrative Income Per Unit $ 6.00 Required 1 Required 2 1.44 0.36 0.60 3.60 0.20 0.15 $ 3.25 Required: 1. Compute income from the special offer. 2. Should the company accept or reject the special offer? Contribution margin A potential customer offers to buy 50,000 units for $3.20 each. These sales would not affect the company's sales through its normal channels. Details about the special offer follow. • Direct materials cost per unit and variable overhead cost per unit would not change. ● Direct labor cost per unit would be $0.54 because the offer would require overtime pay. • Accepting the offer would require incremental fixed general and administrative costs of $5,000. Accepting the offer would require no incremental fixed overhead costs. Fixed overhead Fixed general…
Prepare an absorption-costing income statement for last year. Round to nearest whole number.
Given: The annual accounting data for 2018, presented below. : 1500K$ : 1000K$ Fixed factory overhead : 300K$ Variable factory overhead: 200KS Fixed admin costs : 500K$ Variable admin costs : 250KS : 400K$ 50KS :6000K$ Direct material Direct labour Sales salaries Sales commissions Sales Revenues Required: Write an income statement for the data given above, using a) the gross margin technique, and b) the contribution margin technique
The manufacturing costs of Ackerman Industries for the first three months of the year follow: Total Costs Units Produced January $264,960 1,380 units February 392,730 2,330 March 412,160 3,680 Using the high-low method, determine (a) the variable cost per unit and (b) the total fixed cost. Round all answers to the nearest whole dollar. a. Variable cost per unit $fill in the blank 1 b. Total fixed cost $fill in the blank 2
Calculate and Use Ovrehead Rate During the coming accounting year, Baker Manufacturing, Inc. anticipates the following costs, expenses, and operating data: Direct material (16,000 lb) $80,000 Direct labor (@10/hr) 200,000 Indirect materials 12,000 Indirect labor 22,000 Sales Commissions 34,000 Factory administration 16,000 Nonfactory administrative expenses 20,000 Other manufacturing overhead 80,000 a. Calculate the predetermined manufacturing overhead rate for the coming year for each of the following application bases: (1) direct labor hours, (2) direct labor costs, and (3) machine hours. b. For each item in requirement in requirement a, determine the proper application of manufacuring overhead to Job 63, to which 16 direct labor hours, $150 of direct labor cost, and 40 machine…
Estimated Income Statements, using Absorptionand Variable Costing Prior to the first month of operations ending October 31, Marshall Inc. estimated the following operating results: Sales (24,800 x $86) $2,132,800 Manufacturing costs (24,800 units): Direct materials 1,282,160 Direct labor 302,560 Variable factory overhead 141,360 Fixed factory overhead 168,640 Fixed selling and administrative expenses 45,900 Variable selling and administrative expenses 55,500 The company is evaluating a proposal to manufacture 27,200 units instead of 24,800 units, thus creating an ending inventory of 2,400 units. Manufacturing the additional units will not change sales, unit variable factory overhead costs, total fixed factory overhead cost, or total selling and administrative expenses. a. 1. Prepare an estimated income statement, comparing operating results if 24,800 and 27,200 units are manufactured in the absorption costing format. If an amount box does not…
Lindquist Company has the following information for February: Line Item Description Amount Sales $370,000 Variable cost of goods sold 173,900 Fixed manufacturing costs 55,500 Variable selling and administrative expenses 40,700 Fixed selling and administrative expenses 22,200 Determine the following for Lindquist Company for the month of February: Line Item Description Amount a. Manufacturing margin $fill in the blank 1 b. Contribution margin $fill in the blank 2 c. Operating income $fill in the blank 3
Ocak Uçan Yağlar Sanayi A.Ş. He bought 6 automatic filling machines and paid a total of 600,000 liras for them. The depreciation life of filling machines is 5 years. In this situation a) If the ordinary depreciation method is applied, what is the depreciation amount to be allocated according to the years? 4. What will be the book value at the end of the year? b) If the rapid depreciation method is applied, what is the depreciation amount to be allocated over the years? 4. What will be the book value at the end of the year?
Farrow Company reports the following annual results. Contribution Margin Income Statement Per Unit Annual Total Sales (240,000 units) $ 15.00 $ 3,600,000 Variable costs Direct materials 2.00 480,000 Direct labor 4.00 960,000 Overhead 2.50 600,000 Contribution margin 6.50 1,560,000 Fixed costs Fixed overhead 2.00 480,000 Fixed general and administrative 1.50 360,000 Income $ 3.00 $ 720,000 The company receives a special offer for 24,000 units at $12 per unit. The additional sales would not affect its normal sales. Variable costs per unit would be the same for the special offer as they are for the normal units. The special offer would require incremental fixed overhead of $96,000 and incremental fixed general and administrative costs of $103,000. (a) Compute the income or loss for the special offer.(b) Should the company accept or reject the special offer? Compute the income or loss for the special offer. (Round your "Per Unit" answers to 2…
The following monthly data in contribution format are available for the Ross Company and its only product. Product SD: Sales Variable expenses Contribution margin Fixed expenses Net operating income Total $ $ $ $ $ 224.000 177.800 46,200 34.500 11,700 Per Unit $ 160 127 33 $ company produced and sold 1.400 units during the month and had no beginning or ending inventories, a) What is the current operating leverage? b) Projections indicate that the market will contract by 15% next month. What is the projected net operating income given this increase?
Estimated Income Statements, using Absorption and Variable Costing Prior to the first month of operations ending October 31, Marshall Inc. estimated the following operating results: Sales (25,600 x $91) $2,329,600 Manufacturing costs (25,600 units): Direct materials 1,400,320 Direct labor 332,800 Variable factory overhead 153,600 Fixed factory overhead 184,320 Fixed selling and administrative expenses 50,100 Variable selling and administrative expenses 60,600 The company is evaluating a proposal to manufacture 28,800 units instead of 25,600 units, thus creating an ending inventory of 3,200 units. Manufacturing the additional units will not change sales, unit variable factory overhead costs, total fixed factory overhead cost, or total selling and administrative expenses. a. 1. Prepare an estimated income statement, comparing operating results if 25,600 and 28,800 units are manufactured in the absorption costing format. If an amount box does not…
Locklear, Inc. reports the following information for the year ended December 31: Units sold Sales price Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling and administrative costs Fixed selling and administrative costs 650 units $160 per unit $25 per unit $11 per unit $15 per unit $25 per unit $6 per unit $12,600 per year The operating income calculated using variable costing and absorption costing amounted to $9,100 and $10,300, respectively. There were no beginning inventories. Determine the total fixed manufacturing overhead that will be expensed under absorption costing for the year. OA. $32,500 B. $16,250 C. $17,450 D. $33,150

SEE MORE QUESTIONS

Recommended textbooks for you

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

FINANCIAL ACCOUNTING

Accounting

ISBN:

9781259964947

Author:

Libby

Publisher:

MCG

Accounting

ISBN:

9781337272094

Author:

WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:

Cengage Learning,

Accounting Information Systems

Accounting

ISBN:

9781337619202

Author:

Hall, James A.

Publisher:

Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…

Accounting

ISBN:

9780134475585

Author:

Srikant M. Datar, Madhav V. Rajan

Publisher:

PEARSON

Intermediate Accounting

Accounting

ISBN:

9781259722660

Author:

J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher:

McGraw-Hill Education

Financial and Managerial Accounting

Accounting

ISBN:

9781259726705

Author:

John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS