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Pachacha [2.7K]
3 years ago
9

Raven Company has a target of $70,000 pre-tax income. The contribution margin ratio is 30%. What amount of dollar sales must be

achieved to reach the goal if fixed costs are $36,000? Multiple Choice $23,333. $36,000. $300,000. $353,333. $420,000.
Business
1 answer:
galina1969 [7]3 years ago
8 0

Answer:

$353,333

Explanation:

Given that,

Target pre-tax income = $70,000

Contribution margin ratio = 30%

Fixed cost = $36,000

Contribution required:

= Fixed cost + Earning required

= $36,000 + $70,000

= $106,000

Contribution margin ratio = Contribution margin ÷ Sales

0.3 = $106,000 ÷ Sales

Sales = $106,000 ÷ 0.3

         = $353,333.3 or $353,333

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Campus Stop, Inc., is a student co-op. Campus Stop uses a perpetual inventory system.
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Answer:

Campus Stop, Inc.

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Sales revenue                              $323,300

Sales returns                                    ($1,730)

Sales discounts and allowances <u>  ($2,270)</u>

Net sales                                       $319,300

Cost of goods sold                      <u>($172,870)</u>

Gross profit                                   $146,430

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A U.S. treasury bond (selling at a par value of $1,000) that matures at the end of five years is said to have a coupon rate of 6
pav-90 [236]

Answer:

$1,042.04

Explanation:

to calculate the present value using a continuously compounded interest rate, we can use the following 2 formulas:

1) present value = cash flow / eⁿˣ

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present value = $1,030 / 2.71828¹⁰ˣ⁰°⁰²⁵ = $1,030 / 1.284 = $802.16

2) present value of an annuity = payment [(1 - e⁻ⁿˣ) / (eˣ - 1)]

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  • x = 2.5%
  • n = 9
  • e = 2.71828

present value = $30 [(1 - 2.71828⁻⁹ˣ⁰°⁰²⁵) / (2.71828⁰°⁰²⁵ - 1)] = $30 [(1 - 2.71828⁻⁹ˣ⁰°⁰²⁵) / (2.71828⁰°⁰²⁵ - 1)] = $30(0.2015 / 0.0252) = $239.88

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