1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
barxatty [35]
3 years ago
15

Rather than purchase new equipment, the marketing manager argues that the company's marketing strategy should be changed. Rather

than pay sales commissions, which are currently included in variable expenses, the company would pay salespersons fixed salaries and would invest heavily in advertising. The marketing manager claims this new approach would increase unit sales by 50% without any change in selling price; the company's new monthly fixed expenses would be $331,200, and its net operating income would increase by 25%.
Compute the break-even point in dollar sales for the company under the new marketing strategy.

Morton Company's contribution format income statement for last month is given below:

Sales (46,000 units * $24 per unit) $1,104,000
Variable expenses $772,800
Contribution margin $331,200
Fixed expenses $264,960
Net operating income $66,240
Business
1 answer:
Kitty [74]3 years ago
5 0

Answer:

Break-even point (dollars)= $1,104,000

Explanation:

Giving the following information:

The company's new monthly fixed expenses would be $331,200.

Selling price= 24

Unitary variable cost= (772,800/46,000)= 16.8 per unit

With this information we can calculate the break-even point both in units and dollars:

Break-even point= fixed costs/ contribution margin

Break-even point= 331,200/ (24 - 16.8)= 46,000 units

Break-even point (dollars)= fixed costs/ contribution margin ratio

Break-even point (dollars)= 331,200/ (7.2/24)= $1,104,000

You might be interested in
An account is defined as a record of the business activities related to a particular item. True or false?.
Natalka [10]

An account is defined as a record of the business activities related to a particular item. The given statement is true.

Business activities can be divided into three categories: operating, investing, and financing. The cash flow statement includes a list of the cash flows that were generated and used by each of these operations. Net income on an accrual basis is supposed to be reconciled to cash flow in the cash flow statement.

Manufacturing, storage, accounting, sales, mergers and acquisitions, the issue of securities, etc. are some examples of business activities. The prompt completion of these tasks enables the businesses to survive and compete in the market.

Learn more about business activities here

brainly.com/question/7924898

#SPJ4

3 0
1 year ago
Cindy invests $3000 in a bond trust that pays 8% interest compounded semiannually. Her friend, Jimmy, invests $3000 in a certifi
Elanso [62]

Answer:

Cindy has more amount than Jimmy.

Explanation:

Amount invested by Cindy P = $3000

Annual rate of interest = 8%

As the amount is compounded semiannually

So rate of interest =\frac{8}{2}=4% %

Time = 20 year

So time period n = 20×2 = 40

So amount own by Cindy A=P(1+\frac{r}{100})^n

A=3000(1+\frac{4}{100})^{40}=14403.06 $

Amount deposit by jimmy P = $3000

Annual rate of interest = 7.75 %

As the amount is compounded monthly

So rate of interest r=\frac{7.75}{12}=0.322 %

Time period = 20×12 = 240

So amount own by Jimmy A=P(1+\frac{r}{100})^n

A=3000(1+\frac{0.322}{100})^{240}=6503.650 $

From the calculation we can see that Cindy has more amount than Jimmy.

4 0
3 years ago
What term is used to describe mobile technology that aggregates and provides mobile users content and services such as news, spo
vovangra [49]

A mobile phone is used by a user to perform communications-related tasks . It is used to transfer data between systems.

The most commonly used wireless communication protocol for cellular services. It employs packet switching technology, which divides data into packets for transmission before reassembling it at the other end. GSM is a digital cellular technology that provides mobile data and phone services on a wide range of devices. The Global System for Mobile Communication (GSM) is one of the 2nd telecommunications standards (2G). GSM is simply a wireless network that allows data to be transferred between mobile devices.

Find out more about communication here-

brainly.com/question/22558440

#SPJ4

8 0
1 year ago
Last year, the Miller Company reported a return on assets of 15 percent and an asset turnover of 1.6. In the current year, the c
Tema [17]

Answer:

b. Asset turnover decreased, therefore, total assets had to increase. If total assets increased, yet the return on assets also increased, then net income also had to increase.

Explanation:

The options are as follows

a. Asset turnover decreased, therefore, total assets had to decrease. If total assets decreased, yet the return on assets also increased, then net income also had to increase.

b. Asset turnover decreased, therefore, total assets had to increase. If total assets increased, yet the return on assets also increased, then net income also had to increase.

c. Asset turnover decreased, therefore, total assets had to decrease. If total assets decreased, yet the return on assets also increased, then net income also had to decrease.

d. Asset turnover decreased, therefore, total assets had to increase. If total assets increased, yet the return on assets also increased, then net income also had to decrease.

Let us assume the sales is $100,000

So, the asset turnover equal to

Asset turnover = Sales ÷ Total Assets

1.6 = $100,000 ÷ Total assets

Total assets = $62,500

Now the return on assets equal to

Return on assets = Profit ÷ Total Assets

15% = Profit ÷ $62,500

So, the profit is $9,375

Now in the current year

The asset turnover equal to

Asset turnover = Sales ÷ Total Assets

1.2 = $100,000 ÷ Total assets

Total assets = $83,333.33

Now the return on assets equal to

Return on assets = Profit ÷ Total Assets

19% = Profit ÷ $83,333.33

So, the profit is $15,833.33

Now the increase in asset and profit is

Increase in asset = ($83,333.33 - $62,500) ÷ (62500)

= 33.33%

And, the increase in profit is

= ($15,833.33,- $9,375) ÷ ($9,375)

= 68.89%

As we can see that the increase in asset decreased but at the same time the increase in profit increases that results in increases in total assets and the increment in return on assets.

3 0
3 years ago
To help improve driver safety on highways __________ are textured lines that are used to inform drivers that they are reaching t
alekssr [168]
The answer in the space provided is rumble strips. They are placed on the lane edge to inform or warn the drivers that they are either leaving their travel lane or that they are entering the part of the high way that are not used for traffic use. They are set as a warning for drivers to indicate a specific warning that will be of benefit to them as they drive.
8 0
3 years ago
Other questions:
  • Sunland Company had the following account balances at year-end: Cost of Goods Sold $60,410; Inventory $15,010; Operating Expense
    7·1 answer
  • When Walmart threatens to punish or punishes the other channel member for not undertaking certain tasks, such as if it were to d
    9·1 answer
  • Harry and Sally formed the Evergreen partnership by contributing the following assets in exchange for a 50 percent capital and p
    11·1 answer
  • Texas Inc. has 10,000 shares of 6%, $125 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock ou
    13·1 answer
  • Which of the following is not considered to be a liability? Answers: a. Wages Payable b. Unearned Revenues c. Accounts Payable d
    14·1 answer
  • What is Nick causing? Nick has set up his steel factory near a community lake. The waste from his factory is directly thrown in
    11·2 answers
  • As environmental uncertainties increase, managers must develop techniques and methods for collecting, sorting through, and inter
    11·1 answer
  • Townson Company had gross wages of $200,000 during the week ended December 10. The amount of wages subject to social security ta
    8·1 answer
  • hina's growth rate of real GDP in 2005 and 2006 was 10.5 percent a year and its population growth rate was 0.5 percent a year. I
    10·1 answer
  • juliana was assigned to analyze the process her company uses to write proposals. she worked on her report for more than a month.
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!