Question
In: Finance
Queen Ltd. sells mattresses and has a monthly sales capacity of $120,000. The income statement for...
Queen Ltd. sells mattresses and has a monthly sales capacity of $120,000. The income statement for the current month is:
Sales 80 000
Cost of Goods Sold 36 000
Gross Profit 44 000
Operating Expenses 16 000
Net Income 28 000
QUESTIONS:
1. What is the total contribution for the current month?
2. What would be total contribution at breakeven for one month?
3. What % of capacity is needed to breakeven?
4. What is the break even point for one year?
Solutions
jeff jeffy answered 2 years agoRelated Solutions
A comparative income statement is given below for McKenzie Sales, Ltd., of Toronto: McKenzie Sales, Ltd....
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto:
McKenzie Sales, Ltd.
Comparative Income Statement
This Year
Last Year
Sales
$
7,360,000
$
5,593,600
Cost of goods sold
4,680,000
3,509,500
Gross margin
2,680,000
2,084,100
Selling and administrative expenses:
Selling expenses
1,388,000
1,075,500
Administrative expenses
705,500
616,500
Total expenses
2,093,500
1,692,000
Net operating income
586,500
392,100
Interest expense
101,000
94,000
Net income before taxes
$
485,500
$
298,100
Members of the company’s board of directors are surprised...
A comparative income statement is given below for McKenzie Sales, Ltd., of Toronto: McKenzie Sales, Ltd....
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto:
McKenzie Sales, Ltd.
Comparative Income Statement
This Year
Last Year
Sales
$
7,380,000
$
5,608,800
Cost of goods sold
4,650,000
3,512,000
Gross margin
2,730,000
2,096,800
Selling and administrative expenses:
Selling expenses
1,400,000
1,075,000
Administrative expenses
708,500
613,500
Total expenses
2,108,500
1,688,500
Net operating income
621,500
408,300
Interest expense
105,000
91,000
Net income before taxes
$
516,500
$
317,300
Members of the company’s board of directors are surprised...
A comparative income statement is given below for McKenzie Sales, Ltd., of Toronto: McKenzie Sales, Ltd....
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto: McKenzie Sales, Ltd. Comparative Income
Statement This Year Last Year Sales $ 7,370,000 $ 5,601,200 Cost of
goods sold 4,760,000 3,507,500 Gross margin 2,610,000 2,093,700
Selling and administrative expenses: Selling expenses 1,380,000
1,073,500 Administrative expenses 709,500 615,000 Total expenses
2,089,500 1,688,500 Net operating income 520,500 405,200 Interest
expense 106,000 89,000 Net income before taxes $ 414,500 $ 316,200
Members of the company’s board of directors are surprised...
A comparative income statement is given below for McKenzie Sales, Ltd., of Toronto: McKenzie Sales, Ltd....
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto:
McKenzie Sales, Ltd.
Comparative Income Statement
This Year
Last Year
Sales
$
7,400,000
$
5,624,000
Cost of goods sold
4,610,000
3,509,500
Gross margin
2,790,000
2,114,500
Selling and administrative expenses:
Selling expenses
1,386,000
1,080,500
Administrative expenses
706,500
608,000
Total expenses
2,092,500
1,688,500
Net operating income
697,500
426,000
Interest expense
104,000
84,000
Net income before taxes
$
593,500
$
342,000
Members of the company’s board of directors are surprised...
A comparative income statement is given below for McKenzie Sales, Ltd., of Toronto: McKenzie Sales, Ltd....
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto:
McKenzie Sales, Ltd.
Comparative Income Statement
This Year
Last Year
Sales
$
7,320,000
$
5,563,200
Cost of goods sold
4,660,000
3,510,500
Gross margin
2,660,000
2,052,700
Selling and administrative expenses:
Selling expenses
1,383,000
1,072,500
Administrative expenses
704,000
613,500
Total expenses
2,087,000
1,686,000
Net operating income
573,000
366,700
Interest expense
105,000
84,000
Net income before taxes
$
468,000
$
282,700
Members of the company’s board of directors are surprised...
A comparative income statement is given below for McKenzie Sales, Ltd., of Toronto: McKenzie Sales, Ltd....
A comparative income statement is given below for McKenzie
Sales, Ltd., of Toronto:
McKenzie Sales, Ltd.
Comparative Income Statement
This Year
Last Year
Sales
$
7,310,000
$
5,555,600
Cost of goods sold
4,670,000
3,509,000
Gross margin
2,640,000
2,046,600
Selling and administrative expenses:
Selling expenses
1,393,000
1,074,000
Administrative expenses
705,000
610,000
Total expenses
2,098,000
1,684,000
Net operating income
542,000
362,600
Interest expense
103,000
85,000
Net income before taxes
$
439,000
$
277,600
Members of the company’s board of directors are surprised...
Bombs Away Video Games Corporation has forecasted the following monthly sales: January $ 120,000 July $...
Bombs Away Video Games Corporation has forecasted the following
monthly sales:
January
$
120,000
July
$
65000
February
113000
August
65000
March
45000
September
75000
April
45000
October
105000
May
40000
November
125000
June
55000
December
143000
Total annual sales = $996,000
Bombs Away Video Games sells the popular Strafe and Capture
video game. It sells for $5 per unit and costs $2 per unit to
produce. A level production policy is followed. Each month's
production is equal to annual...
Sales price per unit: (current monthly sales volume is 120,000 units). . . . $25.00 Variable...
Sales price per
unit:
(current monthly sales volume is
120,000 units). . . .
$25.00
Variable costs per
unit:
Direct
materials. . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . .
$6.60
Direct
labor. . . . . . . . . . . . . . . ....
The income statement for Sweetwater Ltd. is shown below: SWEETWATER LTD. Income Statement Year Ended December...
The income statement for Sweetwater Ltd. is shown below:
SWEETWATER
LTD.
Income Statement
Year Ended December 31
(in millions)
2018
2017
2016
Sales
$ 1,603
$ 1,403
$ 1,205
Cost of goods sold
907
754
602
Gross profit
696
649
603
Operating expenses
516
407
401
Income from operations
180
242
202
Interest expense
80
50
40
Income before income tax
100
192
162
Income tax expense
25
48
41
Net income
$ 75
$ 144
$ 121
Part 1...
Saturn Ltd. Has sales of $ 800,000, a net income of $ 60,000 and the following...
Saturn Ltd. Has sales of $ 800,000, a
net income of $ 60,000 and the following balance
sheet:
Assets
Amount ($)
Liabilities and Owners’ Equity
Amount ($)
Cash
$ 10,000
Accounts Payable
$ 30,000
Accounts Receivable
$ 50,000
Other Current Liabilities
$ 20,000
Inventories
$ 150,000
Long-term Debt
$50,000
Net Fixed Assets
$ 90,000
Common Equity
$ 200,000
Total Assets
$ 300,000
Total Liabilities and Owners’ Equity
$ 300,000
Additional Information:
·Cost of goods sold is $ 600,000. Of which...
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