Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. the following income statement was drawn from the

The following income statement was drawn from the records of Finch Company, a merchandising firm:...

70.2K

Verified Solution

Question

Accounting

The following income statement was drawn from the records of Finch Company, a merchandising firm: FINCH COMPANY Income Statement For the Year Ended December 31, Year 1 Sales revenue (5,500 units x $168) Cost of goods sold (5,500 units $89) Gross margin Sales commissions (5% of sales) Administrative salaries expense Required Advertising expense Depreciation expense Shipping and handling expenses (5,500 units x $5) Net income $924,000 (489,500) 434,500 (46,200) (86,000) (37,000) (40,000) (27,500) $197,800 a. Reconstruct the income statement using the contribution margin format. b. Calculate the magnitude of operating leverage. c. Use the measure of operating leverage to determine the amount of net income Finch will earn if sales increase by 20 percent.
image
a. Reconstruct the income stotement using the contribution margin format. b. Calculate the magnifude of operating leverage. c. Use the measure of operating leverage to determine the amount of net income Finch will earn if sales increase by 20 percent

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

Biology
1.2K views

Describe the most common targets of antibiotics in the bacterial cell.

Psychology
1.2K views

#2 **I POST THIS TWICE, DO NOT DUPLICATE YOUR ANSWER TO BOTH POST PLEASE, THANKS The Ethical Dilemma...

Accounting
1.2K views

x is a publicly held corporation with a subsidiary, S, of which X always has owned...

Biology
1.2K views

Which of the following is not a type of relationship tha can be applied in...

Biology
1.2K views

I 4 A solution has a pH of 7 What is the concentration to protons...

Physics
1.2K views

45 Susceptibility of Mg at 300 K is 1 2 10 45 The temperature at...

Basic Math
1.2K views

How many different three digit numbers can be formed using the digits 6 4 2...

Statistics
1.2K views

Question 27 4 You want to obtain a sample to estimate a population mean Based...

Statistics
1.2K views

A random sample of small business stock prices has a sample mean of 54 82...

Algebra
1.2K views

You deposit $750 each month into an account earning 7.9% interest compounded monthly.a) How much...

Algebra
1.2K views

Plot the ordered pair 5 9 on the rectangular coordinate plane Plot 5 9 Next...

Accounting
1.2K views

A machine with a cost of $60,000.00 has an estimated residual value of $4,268.00 and...