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WARRIOR [948]
3 years ago
5

Break-even sales and sales to realize operating income For the current year ended March 31, Cosgrove Company expects fixed costs

of $27,600,000, a unit variable cost of $805, and a unit selling price of $1,150. a. Compute the anticipated break-even sales (units). units b. Compute the sales (units) required to realize operating income of $5,175,000. units
Business
1 answer:
Anna11 [10]3 years ago
3 0

Answer:

a. 80,000 units

b. 95,000 units

Explanation:

The computation is shown below:

a.The anticipated break-even sales (units) is

As we know that

Break even point in units   = Total fixed cost ÷ Contribution margin per unit

= $27,600,000 ÷  $345    

= 80,000 units

Where,

Contribution margin per unit = Selling price per unit - Variable cost per unit

= $1,150 - $805    

= $345

b. The units for realize operating income is

Unit sales for target profit   = (Fixed expense + Target profit) ÷ Contribution margin per unit

= ($27,600,000 + $5,175,000) ÷ $345    

= $32,775,000 ÷ $345    

= 95,000 units

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2 years ago
Johnson Company calculates its allowance for uncollectible accounts as 10% of its ending balance in gross accounts receivable. T
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<em>Incomplete question is "2. What journal entry should Johnson record to recognize bad debt expense for 2021? 3. Assume Johnson made no other adjustment of the allowance for uncollectible accounts during 2021. Determine the amount of accounts receivable written off during 2021 4. If Johnson instead used the direct write-off method, what would bad debt expense be for 2021?"</em>

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2.     Year   Account Title                              Debit     Credit

       2021  Bad debt expense                   $105,000

                  ($500,000*10% + $55,000)  

                         To Allowance for Doubtful Accounts   $105,000

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