Healthy Foods Inc. sells 60-pound bags of grapes to the military for $15 a bag. The...

Healthy Foods Inc. sells 60-pound bags of grapes to the military for $15 a bag. The fixed costs of this operation are $70,000, while the variable costs of grapes are $0.15 per pound.

a. What is the break-even point in bags? (Round your answer to 2 decimal places.)

b. Calculate the profit or loss (EBIT) on 10,000 bags and on 30,000 bags.

c. What is the degree of operating leverage at 18,000 bags and at 30,000 bags? (Round your answers to 2 decimal places.)

d. If Healthy Foods has an annual interest expense of $10,000, calculate the degree of financial leverage at both 18,000 and 30,000 bags. (Round your answers to 2 decimal places.)

e. What is the degree of combined leverage at both 18,000 and 30,000 bags? (Round your answers to 2 decimal places.)

Expert Solution

ekkarill92 answered 1 year ago

Healthy Foods Inc. sells 40-pound bags of grapes to the military for $15 a bag. The...

Healthy Foods Inc. sells 40-pound bags of grapes to the military for $15 a bag. The fixed costs of this operation are $105,000, while the variable costs of grapes are $.20 per pound. a. What is the break-even point in bags? b. Calculate the profit or loss (EBIT) on 14,000 bags and on 40,000 bags. c. What is the degree of operating leverage at 28,000 bags and at 40,000 bags? (Round your answers to 2 decimal places.) ...

Healthy Foods Inc. sells 50-pound bags of grapes to the military for $25 a bag. The...

Healthy Foods Inc. sells 50-pound bags of grapes to the military for $25 a bag. The fixed costs of this operation are $95,000, while the variable costs of grapes are $0.25 per pound. a. What is the break-even point in bags? (Round your answer to 2 decimal places.) b. Calculate the profit or loss (EBIT) on 10,000 bags and on 31,000 bags. c. What is the degree of operating leverage at 22,000 bags and at 31,000 bags? (Round...

United Snack Company sells 60-pound bags of peanuts to university dormitories for $28 a bag. The...

United Snack Company sells 60-pound bags of peanuts to university dormitories for $28 a bag. The fixed costs of this operation are $240,700, while the variable costs of peanuts are $0.19 per pound. a. What is the break-even point in bags? b. Calculate the profit or loss (EBIT) on 11,000 bags and on 24,000 bags. c. What is the degree of operating leverage at 19,000 bags and at 24,000 bags? (Round your answers to 2 decimal places.) ...

United Snack Company sells 40-pound bags of peanuts to university dormitories for $60 a bag. The...

United Snack Company sells 40-pound bags of peanuts to university dormitories for $60 a bag. The fixed costs of this operation are $671,600, while the variable costs of peanuts are $0.35 per pound. a. What is the break-even point in bags? Break-even point bags b. Calculate the profit or loss (EBIT) on 11,000 bags and on 24,000 bags. Bags Profit/Loss Amount 11,000 24,000 c. What is the degree of operating leverage at 19,000 bags and at 24,000 bags?...

United Snack Company sells 60-pound bags of peanuts to university dormitories for $58 a bag. The...

United Snack Company sells 60-pound bags of peanuts to university dormitories for $58 a bag. The fixed costs of this operation are $545,200, while the variable costs of peanuts are $0.34 per pound. a. What is the break-even point in bags? b. Calculate the profit or loss (EBIT) on 12,000 bags and on 25,000 bags. c. What is the degree of operating leverage at 20,000 bags and at 25,000 bags? (Round your answers to 2 decimal places.) d. If United...

United Snack Company sells 60-pound bags of peanuts to university dormitories for $40 a bag. The...

United Snack Company sells 60-pound bags of peanuts to university dormitories for $40 a bag. The fixed costs of this operation are $305,000, while the variable costs of peanuts are $0.25 per pound. a. What is the break-even point in bags? Break-even point bags b. Calculate the profit or loss (EBIT) on 5,000 bags and on 18,000 bags. Bags Profit/Loss Amount 5,000 18,000 c. What is the degree of operating leverage at 17,000 bags and at 22,000 bags? (Round...

United Snack Company sells 40-pound bags of peanuts to university dormitories for $42 a bag. The...

United Snack Company sells 40-pound bags of peanuts to university dormitories for $42 a bag. The fixed costs of this operation are $417,120, while the variable costs of peanuts are $0.26 per pound. a. What is the break-even point in bags? b. Calculate the profit or loss (EBIT) on 12,000 bags and on 25,000 bags. c. What is the degree of operating leverage at 20,000 bags and at 25,000 bags? (Round your answers to 2 decimal places.) ...

1. United Snack Company sells 50-pound bags of peanuts to university dormitories for $38 a bag....

1. United Snack Company sells 50-pound bags of peanuts to university dormitories for $38 a bag. The fixed costs of this operation are $390,000, while the variable costs of peanuts are $0.24 per pound. a. What is the break-even point in bags? b. Calculate the profit or loss (EBIT) on 6,000 bags and on 19,000 bags. Bags Degree of Financial Leverage 6,000 19,000 c. What is the degree of operating leverage at 18,000 bags and at 23,000 bags?...

I have two bags. Bag 1 contains 10 blue marbles, while Bag 2 contains 15 blue...

I have two bags. Bag 1 contains 10 blue marbles, while Bag 2 contains 15 blue marbles. I pick one of the bags at random and add 6 red marbles in it. Then I shake the bag and choose 5 marbles (without replacement) at random from the bag. If there are exactly 2 red marbles among the 5 chosen marbles, what is the probability that I have chosen Bag 1?

Suppose you have been tasked with regulating a single monopoly firm that sells 50-pound bags of...

Suppose you have been tasked with regulating a single monopoly firm that sells 50-pound bags of concrete. The firm has fixed costs of $30 million per year and a variable cost of $1 per bag no matter how many bags are produced. a. If this firm kept on increasing its output level, would ATC per bag ever increase? Is this a decreasing-cost industry? b. If you wished to regulate this monopoly by charging the socially optimal price, what price would...

Question