Review_v1 - Review of Chapter 6 1 Finnefrock Inc produces...

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Review of Chapter 6 1. Finnefrock Inc. produces and sells a single product. The company has provided its contribution format income statement for December. If the company sells 9,200 units, its net operating income should be closest to: $95,800 2. Last year, Black Company reported sales of $640,000, a contribution margin of $160,000, and a net loss of $40,000. Based on this information, the break-even sales point was: $800,000 3. The break-even point in dollar sales for Rice Company is $360,000 and the company's contribution margin ratio is 30%. If Rice Company desires a profit of $84,000, sales would have to total: $640,000 4. North Company sells a single product. The product has a selling price of $30 per unit and variable expenses of 70% of sales. If the company's fixed expenses total $60,000 per year, then it will have a break-even sales of: $200,000 5. Fenestre Corporation's contribution margin ratio is 25%. The company's break-even is 80,000 units and the selling price of its only product is $4.00 a unit. What are the company's fixed expenses? $80,000 6. Jatry Corporation's budgeted sales are $300,000, its budgeted variable expenses are $210,000, and its budgeted fixed expenses are $60,000. The company's break-even in dollar sales is: $200,000 7. Mardist Corporation has sales of $100,000, variable expenses of $75,000, fixed expenses of $30,000, and a net loss of $5,000. How much would Mardist have to sell to achieve a profit of 10% of sales? $200,000
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company's degree of operating leverage is 8. At this sales level, fixed expenses are: $87,500 9. Forest Corporation has prepared the following budgeted data based on a sales forecast of $3,000,000: What would be the amount of dollar sales at the break-even point? $2,000,000 10. Slosh Cleaning Corporation services both residential and commercial customers. Slosh expects the following operating results next year for each type of customer: Slosh expects to have $18,000 in fixed expenses next year. What would Slosh's total dollar sales have to be next year in order to generate a profit of $90,000? $300,000 11. Scott Company's variable expenses are 72% of sales. The company's break-even point in dollar sales is $2,450,000. If sales are $60,000 below the break-even point, the company would report a: $16,800 loss . 12. Mitch Corporation's contribution margin ratio is 14% and its fixed monthly expenses are $87,000. If the company's sales for a month are $678,000, what is the best estimate of the company's net operating income? Assume that the fixed monthly expenses do not change. $7,920
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This note was uploaded on 07/10/2011 for the course MGMT 315 taught by Professor Smith during the Summer '11 term at San Diego State.

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Review_v1 - Review of Chapter 6 1 Finnefrock Inc produces...

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