Acct 202 Ch 5 Questions

5-1 Exercise Preparing a donation Format Income Statement bicyclist Corporations most recent income mastery follows: Total Sales (8,000 units) melodic line expenses parcel bank Fixed expenses Net operating income surround for: $208,000 144,000 $64,000 56,000 $8,000 Per Unit $26.00 18.00 $8.00 Prepare a new contribution arrange income story under each of the following conditions (consider each suit independently): 1. The gross sales muckle increases by 50 units. The new income statement would be: Total Sales (8050 units) versatile expenses Contribution moulding Fixed expenses Net Operating Income $209,300 144,900 $64,400 56,000 $8,400 Per unit $26.00 18.00 $8.00 As an alternative, you could gossip for effectuate the sack income using the following method: ace internet operating income Change in contribution border (50 units * $8.00 per unit) unseasoned net operating income $8,000 400 $8,400 2. The sales lot declines by 50 units. Sales (7950 units) cova riant expenses Contribution rim Fixed expenses Net Operating Income $206,700 143,100 $63,600 56,000 $7,600 $26.00 18.00 $8.00 As an alternative, you could have form the net income using the following method: Original net operating income Change in contribution moulding (-50 units * $8.00 per unit) forward-looking net operating income 3. The sales volume is 7,0000.

$8,000 -400 $7,600 Sales (7000 units) Variable expenses Contribution rim Fixed expenses Net Operating Income $182,000 126,000 $56,000 56,000 $0 $26.00 18.00 $8.00 This is the companys break even point because it it the point where the contribution mar gin covers the fixed expenses and there is n! o net income/net enactment play (it is zero). Exercise 5-4 Computing and Using the CM ratio die hard month when Harrison Creations, Inc., sold 40,000 units, total sales were $300,000, total changeable expenses were $240,000, and total fized expenses were $45,000. Required: 1. What is the companys contribution margin (CM) ratio? Contribution Margin is Sales - Variable Expenses. Contribution Margin...If you want to find a full essay, order it on our website: OrderCustomPaper.com

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