T&H Manufacturing Company produces and a single product. Its current sales are $500,000. The company's...
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Accounting
T&H Manufacturing Company produces and a single product. Its current sales are $500,000. The company's accountant provided the following information:
Selling price per unit $40.00
Manufacturing costs $100,000 + 40% sales
Selling costs $30,000 + 10% sales
Administrative costs $45,000 + 10% sales
Required:
Compute the product's contribution margin ratio.
Compute the company's current net income.
Compute the product's break-even point in dollars and units.
Compute the amount of revenue necessary to earn $60,000 in profit.
Compute the unit contribution margin.
Compute the company's current margin of safety ratio.
Should the company accept a proposal that increases sales by 20% and total fixed costs by 25%?
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