Last month when Holiday Creations, Inc., sold 50,000 units, total sales were $20
ID: 2585655 • Letter: L
Question
Last month when Holiday Creations, Inc., sold 50,000 units, total sales were $200,000, total variable expenses were $120,000 and total fixed expenses were $65,000. Required i. What is the company’s contribution margin (CM) ratio? ii. Estimate the change in the company’s net income if it were to increase its total sales by $1,000. b) What is meant by a product’s contribution margin ratio? How is this ratio useful in planning businesLast month when Holiday Creations, Inc., sold 50,000 units, total sales were $200,000, total variable expenses were $120,000 and total fixed expenses were $65,000. Required i. What is the company’s contribution margin (CM) ratio? ii. Estimate the change in the company’s net income if it were to increase its total sales by $1,000. b) What is meant by a product’s contribution margin ratio? How is this ratio useful in planning busines
Last month when Holiday Creations, Inc., sold 50,000 units, total sales were $200,000, total variable expenses were $120,000 and total fixed expenses were $65,000. Required i. What is the company’s contribution margin (CM) ratio? ii. Estimate the change in the company’s net income if it were to increase its total sales by $1,000. b) What is meant by a product’s contribution margin ratio? How is this ratio useful in planning busines
Last month when Holiday Creations, Inc., sold 50,000 units, total sales were $200,000, total variable expenses were $120,000 and total fixed expenses were $65,000. Required i. What is the company’s contribution margin (CM) ratio? ii. Estimate the change in the company’s net income if it were to increase its total sales by $1,000. b) What is meant by a product’s contribution margin ratio? How is this ratio useful in planning busines
The manager of a computer store has kept track of the number of computers sold per day. On the basis of this information, the manager produced the following list of the number of daily sales. (20 Marks) 3· NUMBER OF DAILY SALES PROBABILITY 0.08 0.17 0.26 0.21 0.18 0.10 If we observe the experiment as observing the number of computers sold tomorrow, determine the sample space. Use set notation to define the event, sell more than three computers. What is the probability of selling five computers? What is the probability of selling two, three or five computers? What is the probability of selling six computers? a) b) c) d) e) 4. In a recent census, the number of color televisions per household was recorded Number of color televisions 0 1,218 32,379 237,961 19,387 4 7,714 5 2,842 a) Develop the probability distribution of X, the number of color televisions per household. o) Determine the following probabilities.
Explanation / Answer
Dear Student Thank you for using Chegg Please find below the answer and please give thumbs up Statementshowing Computations Paticulars Amount ii Sales 200,000.00 201,000.00 Less Variable Expenses (120,000.00) (120,600.00) Contribution Margin 80,000.00 80,400.00 Less Fixed costs (65,000.00) (65,000.00) Net operating Income 15,000.00 15,400.00 1) Contribution Margin Ratio = 80,000/200,000 0.40 0.40 ii) Change in net operating income = 15400 - 15000 400.00 b) product’s contribution margin ratio = Contribution/ Sales If fixed costs do not change, then a dollar increase in contribution margin will result in a dollar increase in net operating income. The CM ratio can also be used in break-even analysis. Therefore, for planning purposes, knowledge of a product’s CM ratio is extremely helpful in forecasting contribution margin and net operating income.
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