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The following monthly budgeted data is available for the International Company: Product C Product J Product R Sales $500,000 $300,000 $900,000 Variable expenses 300,000 210,000 720,000 Contribution margin $ 200,000 $ 90,000 $ 180,000 Budgeted net income for the month is $220,000. Required: a. Calculate the break-even sales for the month. Round up your answers to the nearest whole number b. Calculate the margin of safety. c. Calculate the operating leverage.

The following monthly budgeted data is available for the International Company: Product C Product J Product R Sales $500,000 $300,000 $900,000 Variable expenses 300,000 210,000 720,000 Contribution margin $ 200,000 $ 90,000 $ 180,000 Budgeted net income for the month is $220,000. Required: a. Calculate the break-even sales for the month. Round up your answers to the nearest whole number b. Calculate the margin of safety. c. Calculate the operating leverage.

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter3: Cost Behavior And Cost Forecasting
Section: Chapter Questions
Problem 27BEB: Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for Budgeted Output Refer...
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The following monthly budgeted data is available for the International Company: Product C Product J Product R Sales $500,000 $300,000 $900,000 Variable expenses 300,000 210,000 720,000 Contribution margin $ 200,000 $ 90,000 $ 180,000 Budgeted net income for the month is $220,000. Required: a. Calculate the break-even sales for the month. Round up your answers to the nearest whole number b. Calculate the margin of safety. c. Calculate the operating leverage.
Transcribed Image Text:The following monthly budgeted data is available for the International Company: Product C Product J Product R Sales $500,000 $300,000 $900,000 Variable expenses 300,000 210,000 720,000 Contribution margin $ 200,000 $ 90,000 $ 180,000 Budgeted net income for the month is $220,000. Required: a. Calculate the break-even sales for the month. Round up your answers to the nearest whole number b. Calculate the margin of safety. c. Calculate the operating leverage.
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