Numerade

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Alex Handzus

Numerade educator

10. Splendid Corporation produces and sells a single product. Data concerning that product appear below: Per Unit Percent of Sales Selling price .................................. $120 100% Variable expenses ...................... 36 30% Contribution margin.................... $84 70% Fixed expenses are $516,000 per month. The company is currently selling 7,000 units per month. The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $9 per unit. In ex- change, the sales staff would accept an overall decrease in their salaries of $55,000 per month. The marketing manager predicts that introducing this sales incentive would in- crease monthly sales by 200 units. What should be the overall effect on the company's monthly net operating income of this change? Required: What should be the overall effect on the company's monthly net operating income of this change?

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Breanna Ollech

Numerade educator

5. The Herald Company manufactures and sells a single product which sells for $50 per unit and has a contribution margin ratio of 30%. The company's monthly fixed expenses are $25,000. If Herald desires a monthly target net operating income equal to 20% of sales dollars, sales in units will have to be (rounded): A. 2,500 units B. 5,000 units C. 1,666 units D. 1,000 units

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Luke Humphrey

Numerade educator

Dimitrov Corporation, a company that produces and sells a single product, has provided its contribution format income statement for July. Sales (7,000 units)............. $315,000 Variable expenses ............. 175,000 Contribution margin............ 140,000 Fixed expenses................. 103,500 Net operating income........... $ 36,500 If the company sells 6,900 units, its net operating income should be closest to: A. $35,979 B. $34,500 C. $36,500 D. $32,000

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Alex Handzus

Numerade educator

D. $22,000 2. Menlove Company had the following income statement for the most recent year: Sales (17,000 units)............ $357,000 Variable expenses ............... 255,000 Contribution margin............ 102,000 Fixed expenses................... 68,000 Net operating income........ $ 34,000 Given this data, the unit contribution margin was: A. $2 per unit B. $15 per unit C. $6 per unit D. $4 per unit 3. Dimitrov Corporation, a company that produces and sells a single product, has provided contribution format income statement for July.

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Sheryl Ezze

Numerade educator

5. Inspection costs at one of Krivanek Corporation's factories are listed below: Units Produced Inspection Cost January 630 $8,850 February 615 $8,819 March 602 $8,760 April 595 $8,743 May 688 $9,036 June 626 $8,866 July 646 $8,920 August 670 $8,977 September 678 $9,013 Management believes that inspection cost is a mixed cost that depends on units produced. Required: Using the high-low method, estimate the variable and the fixed component of the inspection cost

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INSTANT ANSWER

Required: Uslng the highlow method, estimate the variable and the fixed component of the inspection co 6. Whitman Corporation, a merchandising company, reported sales of 7,400 units for May at a selling price of $ \$ 677 $ per unit. The cost of goods sold (all variable) was $ \$ 441 $ per unit and the variahle selline expense wras $ \$ 54 $ per unit. The fotal foced selling, expense was $ \$ 155,600 $. The variable administrative expense was $ \$ 24 $ per unit and the total fixed administrative expense was 5370,400 . Required: Preporeacontnithetion format income statement for May. frepareatradional format income statement for May. 2.

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Teo k.