Question 1 The following is Addison Corporation’s contribution format income statement for last month: The company has no beginning or ending inventories. A total of 20‚000 units were produced and sold last month. What is the company’s margin of safety in dollars? Answer $400‚000 $600‚000 $120‚000 $880‚000 . 10 points Question 2 The following is Addison Corporation’s contribution format income statement for last month: The company has
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Prestige Data Services. Mr. Rowe believes it is possible the accounting reports do not reveal the contribution the Data Service has provided and also the accounting for separate activities may obscure the costs and benefits provided. Therefore we have used the exhibits provided to analyze and come to a conclusion whether Prestige Data services should be shut down or allowed more time to show its contribution. Analysis 1) The first thing we noticed is that fixed and variable costs are included in the
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Oil:Sales) Selling Price‚ per unit Liter= 338.55289 1.8 Contribution Margin per unit Liters = Selling Price per unit1.7 – Variable Costs per unit 1.6 = 173.45 1.9 Assuming that the average cost is almost constant for all the SKUs we get an approximation of the cost‚ selling price of the product and the per unit contribution. There for a 300 ML bottle‚ for which we have the offer the contribution shall be: (300/1000)*Contribution Margin per unit Liters1.8 = INR 52.04 1.91 Cost of the Pantene
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Name: ________________________ Class: ___________________ Date: __________ Quiz 2 1) Cost-volume-profit analysis is used primarily by management: A) as a planning tool B) for control purposes C) to prepare external financial statements D) to attain accurate financial results Answer: A Diff: 1 Terms: cost-volume-profit (CVP) Objective: 1 AACSB: Communication 2) One of the first steps to take when using CVP analysis to help make decisions is: A) finding out where the total costs line intersects
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Berkshire Threaded FastenersBerkshire Threaded Fasteners Company has recently lost their president‚ John Magers. The resulting appointment of his inexperienced son Joe Magers has lead to the company ’s loss of confidence. Brandon Cook is the recently appointed general manger who was hired to turn the company around after a loss of $70‚000 in a good business year. As a member of an outside consulting firm I have been called in to give advice on the problems the company is facing. The time period has
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Internal Reporting //ACCN Notes Class 1 Internal Reporting Only for people inside the firm‚ not shared with public or even shareholders All types of businesses‚ profit and nonprofit Internal Reports are used to look ahead: Planning Establishing goals and objectives Directing Coordinating activities and motivating employees Controlling Keeping activities on track‚ are they being met‚ how to get back on track Types of Costs Product- all costs to purchase or manufacture Merchandiser:
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same. There are also a number of variable operating costs estimated as following: Office supplies $25.00 Hand tools and manufacturing supplies 150.00 Part-time labor 100.00 Professional services 50.00 Advertising & promotion 20.00 Contributions 15.00 Dues & subscriptions 35.00 Travel & entertainment 75.00 Taxes & licenses 45.00 Repairs & maintenance 25.00 Utilities & telephone 60.00 Miscellaneous 50.00
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charge 20% more for its water than it does now. 1. What is the maximum sales loss (in % and units) that Healthy Spring could tolerate before a 20% price increase would fail to make a contribution to profit? (That is‚ what is the basic breakeven sales change?) 2. By how much would Healthy Spring’s contribution increase if its sales declined by 15% following the price increase? HEALTHY SPRING WATER COMPANY PROBLEM 1b BREAKEVEN CALCULATIONS WITH A CHANGE IN VARIABLE COSTS It is usually
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strength of its brand equity‚ the strong demand for its products and its helpful salesforce. The company also used selective distribution policy which meant less competition among distributors and thus this policy preserved the distributors’ profit margins. Question 3: There are several possibilities here. The important ones (not counting no response) are: • Spend more resources in educating customers about the benefits of bubbles • Launch uncoated bubbles • Cut prices of the products
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it by 50% more space and selling staff. This move resulted in a five-year lease as well as extensive and expensive renovations. They also made some changes in product offerings and offered more sales potential at the cost of minor reductions in margins. During the year it took to complete the Hallstead’s renovation the industry started showing major changes toward internet based jewelry sales. Tiffany & Company‚ a business with an origin much like Hallstead Jewelers‚ grew into an international
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