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
elena-s [515]
3 years ago
10

Last month, Laredo Company sold 650 units for $125 each. During the month, fixed costs were $8,850 and variable costs were $75 p

er unit. Required: 1. Determine the unit contribution margin and contribution margin ratio. 2. Calculate the break-even point in units and sales dollars. 3. Compute Laredo’s margin of safety in units and as a percentage of sales.
Business
1 answer:
Y_Kistochka [10]3 years ago
3 0

Answer:

1. $50 and 40%

2. 177 units and $22,125

3. 473 units and 72.77%

Explanation:

Price = $125

Variable cost = $75

Fixed cost =$8,850

Contribution margin is the net of sales price and variable cost of the product. It is the cost available to recover the fixed cost and make profit afterward.

1. Contribution margin = Sales price - Variable cost = $125 - $75 = $50

Contribution margin ratio = Contribution margin / Sale price = $50 / $125 = 40%

Break-even is the level of sales at which business has no profit no loss situation.

2. Break-even point = Fixed cost / Contribution margin per unit = $8,850 / $50 = 177 units

Break-even in $ = 177 units x $125 = $22,125

Margin of safety is the level of sales at which the business is safe from making loss. Margin of safety measures the profit after the break-even point.

3. Margin of Safety = Total sales - Break-even point = 650 units - 177 units = 473 units

Margin of safety to sales = ( Margin of safety / Total sales ) = ( 473 units / 650 units ) x 100 = 72.77%

You might be interested in
A company paid Jen Rogers, its sole stockholder, a total of $25,000 in dividends during the current year. The entry needed to cl
sergiy2304 [10]

Debit Income Summary and credit Dividends for $25,000.

Answer: Option 5.

<u>Explanation:</u>

The balancing account of the company or an organisation is where the entries of the company are made and recorded so that at then end of the year the financial position of the company becomes clear to the stake holders of the company.

It is a double entry book keeping record where single entry is made on two sides of the book, the debit side and the credit side. This makes the book in balance for every entry. Entry on the debit and the credit side is made with the same amount to maintain the balance.

7 0
3 years ago
Suppose your firm receives a $ 3.2 million order on the last day of the year. You fill the order with $ 1.7 million worth of inv
klio [65]

Answer and Explanation:

The consequences of given transactions are as follows

a. Revenues rise by $3.2 million  as the firm received an order

b. Earnings rise by $1.5 million  as the firm received an order and it filled by an orders i,e ($3.2 - $1.7)

c. Receivables rise by $1.80 million  as it determines the remaining balance which ultimately increased the receivable balance

d. Inventory declined by $1.7 million  as the order is filled which ultimately declines the stock

e. The cash would rise by $1.4 million

= Earnings - receivable + inventory

= $1.5 million - $1.80 million + $1.7 million

= $1.4 million

4 0
3 years ago
A city government uses eminent domain to seize property for a new public high school complex. Which of the following statements
Evgesh-ka [11]

Answer:hi

Explanation:

The format for the equation of a circle is (x-h)^2+(y-k)^2=r^2, where (h,k) is your center and r is your radius. All we have to do is substitute the correct values, giving us the equation (x+2)^2+(y-1)^2=4

7 0
2 years ago
Belvedere Corporation had a balance in its Equipment account on January 1, Year 1 of $341,200. During the year, equipment origin
Varvara68 [4.7K]

Answer:

$56,600.00

Explanation:

The amount the company spent on purchase of additional equipment during year 1 can be ascertained using the formula below:

amount spent on additional equipment=ending balance of equipment-(beginning balance-cost of equipment sold)

ending balance of equipment is  $304,700

beginning balance is $341,200

cost of equipment sold is $93,100

amount on additional equipment=$304,700-($341,200-$93,100)=$56,600.00  

5 0
3 years ago
Hilton Brews is a company producing instant mixes for all kinds of beverages. It notices that the market for tea has risen due t
Zina [86]

Answer:

Hilton Brews

The organizational growth strategy used by Hilton Brews is:

B. Diversification.

Explanation:

Diversification strategy is the corporate strategy that Hilton Brews has adopted to take advantage of the increased health benefits of teas by introducing a new line of organically grown and processed teas.  Diversification strategy is different from other corporate growth strategies which Hilton Brews could have adopted, including market expansion, market penetration, and product development.

7 0
2 years ago
Other questions:
  • According to an article in marketing news, fewer checks are being written at grocery store checkout stands than in the past. to
    8·1 answer
  • In the 1850s, the issue of slavery complicated the proposal to build a transcontinental railroad, as select one:
    5·1 answer
  • During the recent financial crisis many workers lost their jobs. Amy, for example, lost her job as a pharmaceutical salesperson.
    13·1 answer
  • Waste that comes from the production of consumer goods, mining, agriculture, and petroleum extraction and refining is
    6·1 answer
  • as rome expanded the conquered territories sent payments that honored the acceptance of the new rulers. What were those payments
    7·1 answer
  • An investment adviser has placed an order with the underwriter for 250,000 shares of XYZ stock, a new company that will be liste
    14·1 answer
  • Suppose that demand for a good increases and, at the same time, supply of the good decreases. what would happen in the market fo
    14·1 answer
  • You are the project manager for the KLN Project. You had 19 stakeholders on this project. You have added three team
    13·1 answer
  • A Virginia county is considering whether to pay $50,000 per year to lease a prisoner transfer facility in a prime location near
    11·1 answer
  • Find the partial derivative of f(x, y) =x2y+sin x+cos y
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!