Mahendra Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on itsbilge pump product line for several years. The most recent quarterly contribution format income statement for the bilgepump product line follows:Thalassines Kataskeves, S.A.Income Statement-Bilge PumpFor the Quarter Ended March 31Sales$ 400,000Variable expenses:$Variable manufacturing expenses132,000Sales commissions50,000Shipping21,000Total variable expenses203,000Contribution margin197,000Fixed expenses:Advertising (for the bilge pump productline)30,000Depreciation of equipment (no resalevalue)107,000General factory overheadInsurance on inventoriesPurchasing departmentTotal fixed expenses37,000*Salary of product-line manager126,0006,00044,000+350,000Net operating loss*Common costs allocated on the basis of machine-hours.(153,000)†Common costs allocated on the basis of sales dollars.Discontinuing the bilge pump product line would not affect sales of other product lines and would have no effect on thecompany's total general factory overhead or total Purchasing Department expenses.Required:What is the financial advantage (disadvantage) of discontinuing the bilge pump product line?

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Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Sales Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Variable expenses: Variable manufacturing expenses $ 400,000 $ 132,000

Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Sales Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Variable expenses: Variable manufacturing expenses $ 400,000 $ 132,000

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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Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A.Income Statement—Bilge PumpFor the Quarter Ended March 31 Sales $ 470,000 Variable expenses: Variable manufacturing expenses $ 124,000 Sales commissions 41,000 Shipping 19,000 Total variable expenses 184,000 Contribution margin 286,000 Fixed expenses: Advertising (for the bilge pump product line) 23,000 Depreciation of equipment (no resale value) 118,000 General factory overhead 40,000* Salary of product-line manager 125,000 Insurance on inventories 10,000 Purchasing department 44,000† Total fixed expenses 360,000 Net operating loss $ (74,000) *Common costs allocated on the basis of machine-hours. †Common costs allocated on the…
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A.Income Statement—Bilge PumpFor the Quarter Ended March 31 Sales $ 440,000 Variable expenses: Variable manufacturing expenses $ 122,000 Sales commissions 52,000 Shipping 24,000 Total variable expenses 198,000 Contribution margin 242,000 Fixed expenses: Advertising (for the bilge pump product line) 21,000 Depreciation of equipment (no resale value) 107,000 General factory overhead 46,000* Salary of product-line manager 119,000 Insurance on inventories 7,000 Purchasing department 49,000† Total fixed expenses 349,000 Net operating loss $ (107,000) *Common costs allocated on the basis of machine-hours. †Common costs allocated on the…
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows: Thalassines Kataskeves, S.A. Income Statement—Bilge Pump For the Quarter Ended March 31 Sales $ 420,000 Variable expenses: Variable manufacturing expenses $ 122,000 Sales commissions 53,000 Shipping 12,000 Total variable expenses 187,000 Contribution margin 233,000 Fixed expenses: Advertising (for the bilge pump product line) 27,000 Depreciation of equipment (no resale value) 111,000 General factory overhead 48,000* Salary of product-line manager 122,000 Insurance on inventories 14,000 Purchasing department 43,000† Total fixed expenses 365,000 Net operating loss $ (132,000) *Common costs allocated on the basis of machine-hours. †Common costs allocated on the basis of…
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows: Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Sales Variable expenses: $ 430,000 Variable manufacturing expenses $ 137,000 Sales commissions 47,000 Shipping 18,000 Total variable expenses 202,000 Contribution margin 228,000 Fixed expenses: Advertising (for the bilge pump product line) 24,000 103,000 49,000* 121,000 13,000 46,000+ 356,000 $ (128,000) Depreciation of equipment (no resale value) General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. †Common costs allocated on the basis of sales dollars. Discontinuing the bilge pump would not affect sales of other…
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margin Fixed expenses: $ 480,000 $ 136,000 50,000 16,000 202,000 278,000 Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. †Common costs allocated on the basis of sales dollars. 27,000 107,000 * 47,000 115,000 10,000 58,000+ 364,000 $ (86,000) Discontinuing the bilge pump product line would…
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margin Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Fixed expenses: Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. +Common costs allocated on the basis of sales dollars. $ 330,000 42,000 18,000 M 270,000 80,000 105,000* 32,000 8,000 45,000 $ 850,000 390,000 460,000 540,000 $ (80,000) Discontinuing the bilge pump product line would not…
Thalassines kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump product line follows: Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margin Fixed expenses: Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) General factory overhead Salary of product-line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. +Common costs allocated on the basis of sales dollars. $ 135,000 45,000 11,000 29,000 102,000 38,000* 126,000 15,000 50,000+ $ 430,000 191,000 239,000 360,000 $ (121,000) Discontinuing the bilge pump product line would…
Thalassines Kataskeves, S.A., of Greece makes marine equipment. The company has been experiencing losses on its bilge pump product line for several years. The most recent quarterly contribution format income statement for the bilge pump follows: Sales Variable expenses: Variable manufacturing expenses Sales commissions Shipping Total variable expenses Contribution margini Thalassines Kataskeves, S.A. Income Statement-Bilge Pump For the Quarter Ended March 31 Fixed expenses: Advertising (for the bilge pump product line) Depreciation of equipment (no resale value) General factory overhead Salary of product-Line manager Insurance on inventories Purchasing department Total fixed expenses Net operating loss *Common costs allocated on the basis of machine-hours. *Common costs allocated on the basis of sales dollars. $ 130,000 54,000 21,000 22,000 115,000 36,000 120,000 14,000 57,000 $ 440,000 Required: What is the financial advantage (disadvantage) of discontinuing the bilge pump? 205,000…
The following information pertain to questions 10 through 13. Hoopie Company sells a single product. The company’s sales and expenses for the recent month follow:Total Per unitSales P600,000 P40Less: Variable expenses 420,000_ 28_Contribution margin 180,000 P12Less: Fixed expenses 150,00__Net operating income P30,00010. What is the monthly break-even point in units sold?a. 12, 000 units b. 12,500 units c. 15,200 units d. 11,000 units
H. The Retread Tire Company recaps tires. The fixed annual cost a tire is $9.00. The company charges $25 to recap a tire. the recapping operation is $60,000. The variablec ost or recapping a) For an annual volume of 12,000 tires, determine the total cost, total revenue, and profit. b) Determine the annual break-even volume for the Retread Tire Company operation. c) Determine the contribution margin. d) If the maximum operating capacity of the Retread Tire Company, is 8,000 tires annually, determine the break-ev percentage of that capacity. en volume as a Fixed cost = Variable cost = In the Formula, box type in the formula in word calculate the answer. s that you used to Price = a) V= TC= TR= Formula: Fomula: Fomula: Profit= per year b) V = tires per year Fomula: c) What is the Contribution Margin? Fomula: d) сарасity%3D % cf capacity = Fomula:
Pablo Company wishes to determine the fixed portion of its maintenance expenses (a semi-variable expense), as measured against direct labor hours for the first three months of the year. Information for the first quarter is as follows (refer to the attached picture): What is the fixed portion of Pablo Company’s maintenance expense using high-low method? * direct hours labor maintenance costs January 25000 210000 February 30000 240000 march 27000 222000
A company sells one product and its contribution margin ratio is 20%. The company provides the following data regarding their operation: Current sales revenue Expected sales revenue next year Expected increase in net operating income next year $2,760,000 $2,870,400 20% Assuming that there is no change in total fixed expenses, what is the net operating income for the current year? Answer: $(Click to select)