Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. help save & exit submit asketballs. the compan

Help Save & Exit Submit asketballs. The company has a ball that sells for $28....

80.2K

Verified Solution

Question

Accounting

image

image

image

image

image

image

Help Save & Exit Submit asketballs. The company has a ball that sells for $28. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $18.00 per ball, of which 64% is direct labor cost. Last year, the company sold 30.000 of these balls, with the following results: Sales (30,000 balls) $1,279,200 Variable expenses Contribution margin Fixed expenses Net operating income 529, 200 540, 000 739, 200 210, 000 Required: 1. Co mpute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per bal. if this change takes place and the selling price per ball remains constant at $28.00, what will be next year's 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, S 529,200, as last year

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students