Voltar Company manufactures and sells a telephone answering machine. The companys contribution format income statement...
70.2K
Verified Solution
Link Copied!
Question
Accounting
Voltar Company manufactures and sells a telephone answering machine. The companys contribution format income statement for the most recent year is given below:
Less fixed expenses 240,000
Management is anxious to improve the companys profit performance and has asked for several item of information.
Required:
Compute the Companys CM ratio and variable expense ratio.
Compute the companys break-even point in both units and sales dollars.
Assume that sales increase by $400,000 next year. If cost behaviour patterns remain unchanged by how much will the companys operating profit income increase? Use the CM ratio to determine your answer.
Compute the companys margin of safety in both dollars and percentage form.
Compute the companys degree of operating leverage at the present level of sales.
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!
