EA9. LO 3.3 Brahma Industries sells vinyl replacement windows to home improvement retailers nationwide. The national sales manager believes that if they invest an additional $25,000 in advertising, they would increase sales volume by 10,000 units. Prepare a forecasted contribution margin income statement for Brahma if they incur the additional advertising costs, using this information: Sales (6,500 units at $115) Variable costs (6,500 units at $69) Contribution margin Fixed costs Net income (loss) $747,500 448,500 299,000 19,500 279,500
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- Brahma Industries sells vinyl replacement windows to home improvement retailers nationwide. The national sales manager believes that if they invest an additional $25,000 in advertising, they would increase sales volume by 10,000 units. Prepare a forecasted contribution margin income statement for Brahma if they incur the additional advertising costs, using this information:A Company wants to introduce new product. The estimated price of each mobile phone is RO 60. The company requires a profit margin of 20% on sales. The estimated cost of manufacturing the product is : Material cost : RO 9.500 Labour Cost : RO 12.750 Other Direct Expenses : RO 7.500 Administrative Costs : RO 5.000 Marketing and Selling expenses : RO 15.000 Calculate the Target Cost of the product and the Target Cost Gap.1 Lazy Days Inc. (LDI), sells hammocks. Revenue and cost information is given below: Sales Price 3. TL 30 Unit Variable Cost 20 Annual Fixed Operating Expenses 47,500 Required: a) Determine the sales volume in units and TL amount that would be required to attain a TL 12,500 profit. Verify your answer by preparing an income statement using the contribution margin format. b) LDI is considering the implementation of a quality improvement program. The program will require a TL 2.50 increase in the variable cost per unit. To inform its customers of the quality improvements, the company plans to spend an additional TL 5,000 for advertising. Assuming that the improvement program will increase sales to a level that is 1,500 units above the amount computed in requirement a, should LDI proceed with plans to improve product quality? Support your answer by preparing a budgeted income statement. c) Determine the new break-even point volume of units and sales in TL as well as the margin of safety…
- REQUIRED Answer each of the following questions independently. As far as possible use the expanded contribution margin model to present your answers. Calculate the total Contribution Margin and Operating Profit (Loss) if all 30 000 pallets are Sold. .calculate the margin of safety (as a percentage) for 2022 Use the contribution margin ratio to calculate the sales value required to achieve an operating profit of R6 000 000. Suppose an additional R300 000 is spent on advertising in order to increase the sales by 3 000 Calculate the number of pallets that need to be produced and sold to break even. Suppose the management team of…Flyer Company sells a product in a competitive marketplace. Market analysis indicates that its product would probably sell at $48 per unit. Flyer management desires a 12.5% profit margin on sales. Their current full cost for the product is $44 per unit.In order to meet the new target cost, how much will the company have to cut costs per unit, if any? a.$1 b.$2 c.$3 d.$0average variable cost (cost price) is SAR 9. Thus, every time the store sells a toy car it has SAR A Toy store sells remote control car. The average selling price is SAR 15 and the o remaining after it pays the manufacturer. This SAR 6 is referred to as the unit contribution. The fixed costs of operating the store (its operating expenses) are SAR 100,000 per year. If the total sales units are 20,000. Prepare the Income statement in contribution margin a. format. b. The fixed costs of operating the store (its operating expenses) are SAR100, 000 per year. Find Break-even in units? If the owner desired a profit of SAR 25,000, what will be break-even point in SAR? с.
- Sportsbags Inc. makes and sells hockey bags for students. Financial projections for this line of products are revenue of $896,000, total variable costs of $242,920, and fixed costs of $595,000. (a) How much is the contribution margin and the contribution rate?(b) How much of this product line does the business need to sell to break even?(c) If the business was to save $11,000 in variable costs by offering fewer colours of hockey bags, how much of this product line does the business need to sell to break even?(d) If a specialized logo was printed on the hockey bags, the variable costs would increase by 3%, and the fixed costs would increase by $12,000. If the price of the hockey bags was then increased by 4%, what would be the resulting net income?REQUIRED Answer each of the following questions independently. As far as possible use the expanded contribution margin model to present your answers. Suppose an additional R300 000 is spent on advertising in order to increase the sales by 3 000 Calculate the number of pallets that need to be produced and sold to break even. Suppose the management team of Lomax Ltd is considering a R30 per pallet decrease in the selling price with the expectation that this would increase the sales volume by 10%. Is this a good idea? Motivate your answer with the relevant calculations. Determine the selling price per pallet that will enable Lomax Ltd to achieve an operating profit of R3 192 000. INFORMATION Lomax Ltd…Derby Phones is considering the introduction of a new model of headphones with the following price and cost characteristics. Sales price $ 18 per unit Variable costs 7 per unit Fixed costs 27,000 per month Assume that the projected number of units sold for the month is 7,000. Consider requirements (b), (c), and (d) independently of each other. Required: a. What will the operating profit be? b. What is the impact on operating profit if the sales price decreases by 10 percent? Increases by 20 percent? c. What is the impact on operating profit if variable costs per unit decrease by 10 percent? Increase by 20 percent? d. Suppose that fixed costs for the year are 10 percent lower than projected, and variable costs per unit are 10 percent higher than projected. What impact will these cost changes have on operating profit for the year? Will profit go up? Down? By how much?
- Required: 1. Complete the following table. 2. Suppose Sandy Bank sells its canoes for $590 each. Calculate the contribution margin per canoe and the contribution margin ratio. 3. This year Sandy Bank expects to sell 760 canoes for $590 each. Prepare a contribution margin income statement for the company. 4. Calculate Sandy Bank's break-even point in units and in sales dollars. Sandy Bank sells its canoes for $590 each. 5. Suppose Sandy Bank wants to earn $76,000 profit this year. Calculate the number of canoes that must be sold to achieve this target. Sandy Bank sells its canoes for $590 each. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Complete the following table. Note: Round your "Cost per Unit" answers to 2 decimal places. Number of Canoes Produced and Sold Total costs Variable Costs Fixed Costs Total Costs Cost per Unit Required 3 Required 4 Variable Cost per Unit Fixed Cost per Unit Total Cost per Unit $ $ $ 500 Required 5 780 0 0.00Derby Phones is considering the introduction of a new model of headphones with the following price and cost characteristics. Sales price $ 21 per unit Variable costs 7 per unit Fixed costs 27,000 per month Assume that the projected number of units sold for the month is 7,000. consider requirements (b), (c), and (d) independently of each other. Required: a. What will the operating profit be? B. What is the impact on operating profit if the sales price decreases by 10 percent? Increases by 20 percent? c. What is the impact on operating profit if variable costs per unit decrease by 10 percent? Increase by 20 percent? d. suppose that fixed costs for the year are 10 percent lower than projected, and variable costs per unit are 10 percent higher than projected. What impact will these cost changes have on operating profit for the year? Will profit go up? Down? By how much? complete this question by entering your…EasyFind manufactures and sells golf balls. The company is conducting a price test to find a better price point. Presently their golf balls sell for $22 per dozen. Their current volume is 5,730 dozen per month. They are considering reducing their sales price by 24% per dozen. What % increase in unit sales is necessary to achieve the same level of total contribution? 31.58% is INCORRECT. PS1 2 3 4 56 7 TRY QUESTION AGAIN EXIT PRACTICE PRACTIO CALCULATED VARIABLES: newvol - 10,232 newunits a 7,539 newucont - $6.72 newprice = $16.72 tcont = $68,760 revenues $126,060 Xavi sells seashore paintings. His annual Fixed Costs are $1,000 and the Variable Costs are $9 per painting. If Xavi sells his paintings for $15, and sells 50 paintings per year more than his breakeven volume, what is his average cost per painting? 0.00 Average Cost ($) PS3 12 3 4 56 7 SUBMIT ANSWER EXIT CALCULATED VARIABLES: bevol = 167 marpct = 0.40 (40%) contrib = $6.00