Bigelow Industries manufactures belts. The company\'s degree of operating levera
ID: 2520376 • Letter: B
Question
Bigelow Industries manufactures belts. The company's degree of operating leverage is 3 times. Each belt sells for $10 and has a contribution margin of S6. Bigelow expects to sell 37,500 belts. Their fixed costs are: 15. A. S 55,000 B. S 75,000 C. S112,000 D. S150.000 E. $165,000 Use the following information to answer Questions 16-17. Marley Company produces flower pots for gardens. The standard costs for direct labour are: Direct labour: 1.5 hours are required to make one pot. The labour rate per hour is $7.00. Actual results for November were: The actual direct labour cost was $102.000 for 14.900 hours worked. Actual number of pots produced for November totalled 10,000 pots 16. The direct labour rate variance for November is A.$2,300 U B. $2,300 F C. $1,000 U D. $1,000 F E. $1,500 UU 17. The direct labour efficiency variance for November is A.$700 F B. $700 U C. $1,200 F D. $1,200 U E. $2,400U 18. A performance measurement tool that integrates a firm's financial and non-financial perspectives such as customer satisfaction, internal business operations, learning and growth is known as: A. management by exception B. zero-based budgeting approach C. just-in-time concept D. kaizen costing (continuous improvement) E. the balanced scorecardExplanation / Answer
15)
Dear student, only one question is allowed at a time. I am answering the first question
Total contribution
= Quantity sold x Contribution per unit
= 37,500 x $6
= $ 225,000
Operating Income = Contribution – Fixed costs
Degree of operating leverage
= Contribution / Operating Income
3 = $225,000 / ($225,000 – Fixed costs)
So, ($225,000 – Fixed costs) = $225,000 / 3
So, Fixed costs = $225,000 - $75,000
= $150,000
So, as per above calculations, option D is the correct option
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