FINALW~1 - Concordia University John Molson School of...

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Concordia University Comm 305/4 Winter 2003 John Molson School of Business Solution to Final Exam Question 1 Multiple Choice Answer Key (20 marks total) Q# Answer marks 1. D 2 2. B 2 3. D 2 4. B 1 5. A 2 6. D 2 7. B 2 8. D 1 9. D 2 10. B 2 11. C 1 12. D 1
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Concordia University Comm 305/4 Winter 2003 John Molson School of Business Solution to Final Exam Question 2 Suggested Solution a) Contribution margin for company = $200,000/$600,000 = 33.33% Sales revenues to break even = $150,000 / .3333 = $450,000 b) # Romanesque pillars [$450,000 x 60%] / $40 = 6,750 romanesque pillars # Contemporary pillars [$450,000 x 40%] / $20 = 9,000 contemporary pillars c) Operating leverage = CM/operating income = $200,000/$50,000 = 4 Therefore a 40% increase in sales would result in a 160% increase in operating income (40% x 4) d) Margin of safety = $600,000 - $450,000 = $150,000
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Concordia University Comm 305/4 Winter 2003 John Molson School of Business Solution to Final Exam Question 3 Suggested Solution 1. Purchases Budget April May June Cost of Sales 42,000 51,000 54,000 Desired Ending Inv. 15,300 16,200 9,000 Total needs 57,300 67,200 63,000 Less: Beginning Inv. (12,600) (15,300) (16,200) Purchases 44,700 51,900 46,800 2. Cash Budget
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FINALW~1 - Concordia University John Molson School of...

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