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algol [13]
2 years ago
5

E3-27 (book/static) The Home Style Eats has two restaurants that are open 24 hours a day. Fixed costs for the two restaurants to

gether total $ 430 comma 500 per year. Service varies from a cup of coffee to full meals. The average sales check per customer is $ 8.75. The average cost of food and other variable costs for each customer is $ 3.50. The income tax rate is 36​%. Target net income is $ 117 comma 600. Requirements 1. Compute the revenues needed to earn the target net income. 2. How many customers are needed to break​ even? To earn net income of $ 117 comma 600​? 3. Compute net income if the number of customers is 170 comma 000. Requirement 1. Compute the revenues needed to earn the target net income. Using the equation​ method, select the basic formula used to compute the revenues needed to earn the target net income. - - = / Choose from any drop-down list and then click Check Answer. 6 parts remaining
Business
1 answer:
vazorg [7]2 years ago
3 0

Answer:

Explanation:

1.

Contribution Margin=Sales - variable cost =$8.75-$3.50=$5.25

Contribution Margin Ratio = Contribution Margin / Sales = $5.25/ $8.75=60%

Pre-Tax Net Income=Net Income/(1-tax rate)

$117,600/(1-0.36)=$183,750

Target Revenue =Fixed cost +Target Pre-Tax net Income/Contribution margin Ratio =($430,500+$183,750)/0.6=$1,023,750

2. Number of customers needed to Break Even

Fixed costs/Contribution margin per unit=$430,500/$5.25=82,000 Customers

Number of customers to earn 117,600 = (Fixed costs + 117,600)/5.25 = (430,500+117,600)/5.25 = 104,400

3.  

Sales (170,000*8.75)   1,487,500

Less: Cost of goods sold   (170,000*3.50)  -595,000

Contribution margin  892,500

Less: fixed costs  -430,500

Net Income before tax  462,000

Less: tax rate (462,000*36%)  - 166,320

Net Income after tax   295,680

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Answer:

E=-4.0746

Explanation:

Using the midpoint method, Lauren's income elasticity of demand for new outfits is determined by the change in income multiplied by the average number of outfits, divided by the change in the number of outfits multiplied by the average income:

E=\frac{\Delta I*O_{avg}}{\Delta O*I_{avg}}\\E=\frac{(37,000-30,000)*\frac{20+19}{2}}{(19-20)*\frac{37,000+30,000}{2}}\\E=-4.0746

Her income elasticity of demand for new outfits is -4.0746.

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Answer:

Explanation:

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Midyear on July 31st, the Digby Corporation's balance sheet reported: Total Assets of $210.761 million Total Common Stock of $6.
xeze [42]

Answer:

the  Digby Corporation's total liabilities is $156.92 million

Explanation:

The computation of the total liabilities is given below:

Total Liabilities is

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The same should be relevant

5 0
3 years ago
Carver Corporation produces a product which sells for $40. Variable manufacturing costs are $18 per unit. Fixed manufacturing co
son4ous [18]

Answer:

$16

Explanation:

The computation of contribution margin per unit is shown below:-

For computing the contribution margin per unit first we need to find out the selling commission which is shown below:-

Selling commission = Sold product × Selling commission percentage

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Now, Contribution margin = Sales - Variable costs

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3 years ago
Supler Corporation produces a part used in the manufacture of one of its products. The unit product cost is $22, computed as fol
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Answer:

It is cheaper to buy the component.

Financial advantage= $23,500

Explanation:

Giving the following information:

Direct materials $7

Direct labor $8

Variable manufacturing overhead $3

Fixed manufacturing overhead $4

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First, we need to calculate the total cost of making the product:

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Total cost= (7 + 8 + 3 + 4)*4,700= 103,400

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Fixed costs= 2*4,700= 9,400

Buy= 4,700*15= 70,500

Total cost= 79,900

It is cheaper to buy the component.

Financial advantage= 103,400 - 79,900= $23,500

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3 years ago
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