Chapter 5: Applying Excel 3 Data 5 Selling price per unit 60,000 units STO per u

Question

Chapter 5: Applying Excel 3 Data 5 Selling price per unit 60,000 units STO per unit d Vaniable expenses per unt S40 per unt Fixed eoxpenses $1,008,000 If your formulas are correct, you should get the correct answers to the fol lowing questions (a) What is the break-even in dollar sales? ales 3,300,000 b) what is the margin of safety percentage? (c) What is the degree of operating leverage? (Round your answer to 2 decimal places) 5.00 3 Us'7G-8 cages o, ocara: ng ,?.ag* and won out c., ng ng ar hina you, wer.sneet ealculate the

Explanation / Answer

Req 4-a: INCOME STATEMENT: Revised Present Sales revenue (72000 units @ 70) 5040000 4200000 Less: Variable cost (72000 units @ 49) 3528000 2940000 Contribution margin 1512000 1260000 Less: Fixed expense 1,008,000 1,008,000 Revised Net income 504,000 252,000 Req 4-b Revised net income 504000 Less: Net Income 252000 Increase in Net Income 252000 % Increase in Income (Increase in Income /Current income *100) ($ 252000 / 252,000 *100 ) = 100%

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