Please solve this question as soon as possible with an hour and a half max...

80.2K

Verified Solution

Question

Accounting

Please solve this question as soon as possible with an hour and a half max (and show all the calculations to get a like from me & my friend too) Thanks!!

image SUBMIT YOUR WORK for this question. You must input into Connect your answers for at least part A of this question. Blue Inc produces a single product. The results of the company's operations for a typical month are summarized in contribution format as follows The company produced and sold 125,000 units of product during the month. There were no beginning or ending inventories. Required: Part A) Given the present situation, compute: A1 The break-even sales in units (round up). A2 The break-even sales in dollars. A3 The sales in units that would be required to produce operating income of $150,000. A4 Compute the degree of operating leverage based on last months sales. If sales were to increase by 8% next month, using operating leverage what would be the new income? Part B) Management is considering using a higer-quality component in the product currently being produced. This would result in variable costs increasing by $0.55 per unit, but fixed quality inspection costs would decline by $35,000. Using this information: B1 Prepare a revised contribution format income statement under the proposal (provide total, per unit and percentage) B2 Under the new proposed plan, compute the break-even point in units (round up) B3 Under the new proposed plan, compute the break-even point in dollars. B4Should the company choose to implement the new component or maintain its current situation? Explain

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