USE THE FOLLOWING INFORMATION FOR THE NEXT 3 QUESTIONS Below is an income statement for XYZ Company...

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General Management

USE THE FOLLOWING INFORMATION FOR THE NEXT 3QUESTIONS
                    Below is an income statement for XYZ Company for 2020:
Sales
$400,000
Variable costs
(150,000)
Contribution margin
$250,000
Fixed costs
(200,000)
Net Income
$ 50,000
           37.Calculate breakeven sales dollars for XYZ Company using theY-formula.
                      A. $220,000
                      B. $320,000
                      C. $350,000
                      D. $270,000
38. The degree of leverage(DOL) for XYZ Company in 2020 is equal to whatamount?
           A. 1.0
           B. 2.0
           C. 3.0
           D. 4.0
           E. 5.0
39. Using the degree of leverage(DOL) for 2020 that you just calculated inquestion #38, if XYZ Company expects sales to increase 10% in 2021,by how much will the net income increase in 2021?
$5,000
$10,000
$15,000
$20,000
$25,000

Answer & Explanation Solved by verified expert

4.4 Ratings (941 Votes)

Q37 350000We know that breakeven sales is that sales value which gives netincome 0Net Income Sales Variable Cost Fixed CostTo find the Breakeven Sales we See Answer

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Sales	$400,000
Variable costs	(150,000)
Contribution margin	$250,000
Fixed costs	(200,000)
Net Income	$ 50,000