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118 answer b the percentage increase in profit can be

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118 .Answer:BThe percentage increase in profit can be calculated by multiplying the degree of operatingleverage (DOL) by the percentage increase in sales during the second month.The sales increased by 30% (P4,500 ÷ P15,000) and therefore the profit percentageincreased by 180% (6 x 30%).The expected profit during the next month would be:
128P45,000 + (P45,000 x 1.8)P126,000119 .Answer:CBreakeven Units:Fixed Costs ÷ Unit Contribution MarginP6,000,000 ÷ 30020,000 pairs120 .Answer:BContribution margin (P18,000 x 300)P5,400,000Less Fixed costs6,000,000Net lossP(600,000)121 .Answer:AThe breakeven level for the sales outlet is expected to rise because of additional commission,a variable cost item, and such a commission is being paid for all pairs of shoes sold.Breakeven in pairs of shoes:6,000,000 ÷ (30075)26,667 pairs122 .Answer:DThough an additional commission is paid on pairs of shoes sold, the breakeven point is notaffected and shall remain at 20,000 because the additional commission applies only to numberof pairs of shoes sold in excess of breakeven level.The profit contribution by the 5,000 pairs is based on reduced contribution margin per pair.Profit:5,000 x (30050)P1,250,000Alternative Solution:Sales (25,000 x P800)P20,000,000Variable costs (24,000 x P500)12,750,000Total contribution margin7,250,000Fixed costs600,000ProfitP1,250,000123 .Answer:ABecause the breakeven level is unchanged, the calculation of the number of pairs to earnP900,000 issimple.The amount of the desired profit will be contributed by the number ofpairs of shoes in excess of breakeven, each contributing P250.20,000 +(P900,000 ÷ 250)23,600 pairs124 .Answer: B300XP6,000,000 = 440XP8,142,000140X = P2,142,000X = 15,300 pairs125 .Answer:ABreakeven peso sales:P1,800,000 ÷ 0.3P6,000,000CMR = P1,755,000 ÷ P5,850,00030%126 .Answer:BAdditional contribution margin P800,000 x 0.30P240,000Additional fixed cost160,000Increase in profitP80,000127 .Answer:BSales39,000 x P270P10,530,000Variable cost 39,000 x P2108,190,000Contribution margin2, 340,000Fixed cost2,400,000Net lossP(60,000)128 .Answer:BOriginal unit contribution margin(1,755,000 ÷ 19,500)P90.00Less increase in packaging cost7.50New Unit contribution marginP82.50Unit sales required:(P1,800,000 + P97,500) ÷ P82.5023,000129 .Answer:ABreakeven units, Automated
129(P1,800,000 + P720,000) ÷ (P90 + P30)P2,520,000 ÷ 9021,000Breakeven units, Present(P1,800,000 ÷ 90)20,000Increase in breakeven units1,000130 .Answer:CThe computation of the indifference point for the two processes can be determined by dividingthe increase in fixed costs by the decrease in variable cost per unit because the selling pricewas unchanged.Indifference Point:P720,000 ÷ 3024,000131 .Answer:BIf the level of sales is higher than the indifference point, the one with higher leverage, i.e.,higher fixed costs and lower unit variable cost, will provide higher income.The automatedprocess has the higher leverage and therefore, it has higher income:Difference in income:(26,00024,000)30P60,000132 .Answer:CBreakeven units = Fixed costsUnit contribution marginP100,000(P400P200)500 units133 .Answer:DStep 1:Compute before-tax profit:P240,000(1.00.4)P400,000Units sales required to earn before-tax profit:(P100,000 + P400,0000)P2002,500 unitsAlternative Solution:Profit = SalesVariable costsFixed costsP400,000 = P400XP200XP100,000P500,000= P200XX = 2,500 units134 .Answer:CRevenue (350 x P400) + (2,700 x P360)P1,112,000Variable costs (3,050 x P200)610,000Contribution margin502,000Fixed expenses100,000Operating incomeP402,000Income tax160,800Net incomeP241,200135 .Answer:ARevenue(350 x P400) + (2,200 x P370)P954,000Variable costs(350 x P200) + (2,200 x P175)455,000Contribution margin499,000Fixed expenses100,000Operating income399,000Income tax159,600Net incomeP239,400136 .Answer:BRevenue(350 x P400) + (2,000 x P380)P900,000Variable costs (2,350 x P200)470,000Contribution marginP430,000Fixed costs90,000Operating profit340,000Income tax136,000Net incomeP204,000137 .Answer:DBefore tax profit objective(240,000 ÷ 0.6)P400,000Fixed costs100,000Total contribution margin required500,000Less contribution margin made on units soldJanuaryMay(350 x 200)70,000Additional contribution margin still neededP430,000Additional contribution margin from 2,500 units(2,500 x P175)P437,500Less additional contribution margin required to meet profit objective430,000Maximum advertising costP7,500
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