Question

You have been provided with the following information: Total Sales $ 90,000 Less Variable expenses 54,000 Contribution margin 36,000 Less fixed expenses 24,000 Operating profit $ 12,000 If sales decrease by 10%, what level of fixed costs will maintain the current operating profit? $20,400. $12,000. $24,000. $21,600.

Name: you have been provided with the following information total sales 90000 less variable expenses 54000 contribution margin 36000 less fixed expenses 24000 operating profit 12000 if sales decre 84606
Uploaded: 2023-02-11T01:47:53-08:00
Duration: 1 min 21 s
Channel: Brooke Bussoletti
Description: you have been provided with the following information total sales 90000 less variable expenses 54000 contribution margin 36000 less fixed expenses 24000 operating profit 12000 if sales decre 84606

          You have been provided with the following information:
Total
Sales
$
90,000
Less Variable expenses
54,000
Contribution margin
36,000
Less fixed expenses
24,000
Operating profit
$
12,000
If sales decrease by 10%, what level of fixed costs will maintain the current operating profit?
$20,400.
$12,000.
$24,000.
$21,600.

Added by Mar W.

Horngren’s Cost Accounting

Srikant M. Datar, Madhav V. Rajan 16th Edition

Instant Answer

Solved by Expert Brooke Bussoletti

02/11/2023

Step 1

Original Sales = $90,000 Decrease in Sales = 10% of $90,000 = 0.10 × $90,000 = $9,000 New Sales = Original Sales - Decrease in Sales = $90,000 - $9,000 = $81,000 Show more…

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You have been provided with the following information: Total Sales $ 90,000 Less Variable expenses 54,000 Contribution margin 36,000 Less fixed expenses 24,000 Operating profit $ 12,000 If sales decrease by 10%, what level of fixed costs will maintain the current operating profit? $20,400. $12,000. $24,000. $21,600.