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
Ksivusya [100]
2 years ago
11

The following costs result from the production and sale of 5,000 drum sets manufactured by Tight Drums Company for the year ende

d December 31, 2017. The drum sets sell for $350 each. The company has a 25% income tax rate.
Variable production costs
Plastic for casing $ 185,000
Wages of assembly workers 510,000
Drum stands 230,000
Variable selling costs
Sales commissions 175,000
Fixed manufacturing costs
Taxes on factory 5,000
Factory maintenance 10,000
Factory machinery depreciation 70,000
Fixed selling and administrative costs
Lease of equipment for sales staff 10,000
Accounting staff salaries 60,000
Administrative management salaries 140,000

Prepare contribution margin income statement for the company.
Business
1 answer:
hammer [34]2 years ago
4 0

Answer and Explanation:

The preparation of the contribution margin income statement for the company is presented below:

                                 Tight Drums Company

                    Contribution margin income statement

                    For the year ended December 31, 2017

Sales (5,000 drums × $350)      $1,750,000

Less: Variable cost

Plastic for casing -$185,000

Wages of assembly workers $510,000

Drum stands $230,000

Variable selling costs

Sales commissions $175,000

Total variable cost                                         -$1,100,000

Contribution margin                                        $650,000

Less: Fixed cost

Fixed manufacturing costs

Taxes on factory $5,000

Factory maintenance $10,000

Factory machinery depreciation $70,000

Fixed selling and administrative costs

Lease of equipment for sales staff $10,000

Accounting staff salaries $60,000

Administrative management salaries $140,000

Total fixed cost                                                          -$295,000

Net operating income                                                 $355,000

Less: income tax expense at 25%                             -$88,750

Net income                                                                   $266,250

We simply deduct the variable cost and fixed cost from the sales revenue so that the net operating income could come and then deducted the income tax expense so that net income could arrive

You might be interested in
List four factor you should consider when selecting a financial institution
DanielleElmas [232]

Answer:

▪︎Products and Services That Fit Your Needs.

▪︎Security for Your Money.

▪︎Convenient Access to Your Cash.

▪︎Minimal Fees.

Explanation:

3 0
2 years ago
Levi Corporation (a U.S. company) has several transactions with foreign entities. Each transaction is denominated in the local c
alukav5142 [94]

Answer: $1500 loss

Explanation:

From the question, On December 2, 20X1, Levi sold confectionary items to a foreign company by selling at a price of 50,000 yen when direct exchange rate was 1 yen = $1.15.

Sale value in dollar = 50,000 × 1.15

= $57500

The account has not been settled as of the year ended December 31, 20X1, when exchange rate had changed to 1 yen = $1.12.

Sale value in dollar = 50,000 × 1.12

= $56000

Foreign exchange loss:

= $57500 - $56000

= $1500 loss

3 0
3 years ago
Suppose two economists are debating tax reform bill. Both economists agree that the bill would increase the after-tax income of
Margarita [4]

Answer:

The correct answer is letter "C": Different choices about the right simplifications to use in economic analysis.

Explanation:

Economic Analysis refers to the study of economic situations within a region using different tools for that purpose that will let determine what the possible solutions and consequences of taking decisions of those situations could be. That is why in the case the two economists after analyzing the effects of the tax reform bill decided not to implement it.

5 0
3 years ago
Which one is the correct answer ?
Vinil7 [7]

Answer:

I believe its B.

Explanation:

C and D don't make any sense since it is impractical to suffer during the hot months, and A is wrong (I believe) since the budget needs to be shifted to bring attention to the AC. So by elimination its B.

8 0
2 years ago
P1 returns goods previously purchased on credit from P2.
natali 33 [55]
The correct answer is d
8 0
3 years ago
Other questions:
  • Candy Co. exchanged inventory with Dandy Co. in a transaction that lacks commercial substance. Both Candy’s and Dandy’s inventor
    7·1 answer
  • What you believe providing great service looks like
    11·1 answer
  • Last year, Reggie, a Los Angeles, California resident, began selling autographed footballs through Trojan Victory (TV), Incorpor
    6·1 answer
  • Based on the data provided, which statement about the total cost for one year is true?
    7·2 answers
  • The​ company, suppliers,​ distributors, and customers who open double quote partnerclose double quote with one another to improv
    7·1 answer
  • Murphy & Johnson is a privately owned manufacturer of small motors for lawnmowers, tractors, and snowmobiles. The components
    7·1 answer
  • A​ zero-coupon bond is a bond that is sold now at a discount and will pay its face value at the time when it​ matures; no intere
    13·1 answer
  • Space Fuel Inc. is considering establishing a new propellant depot to provide space vehicles a refueling point in their trek to
    5·1 answer
  • Case Study: Melanie’s Breakeven Analysis Melanie is considering opening a not-for-profit child care and education center and wan
    8·1 answer
  • In your opinion, do we need to use a structured decision making model to make decisions in business.
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!