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Disk City, Inc. is a retailer for digital video disks. The projected net income for the current year is $2,320,000 based on a sales volume of 230,000 video disks. Disk City has been selling the disks for $19 each. The variable costs consist of the $5 unit purchase price of the disks and a handling cost of $2 per disk. Disk City's annual fixed costs are $440,000. Management is planning for the coming year, when it expects that the unit purchase price of the video disks will increase 30 percent. (Ignore income taxes.) Required: 1. Calculate Disk city's break-even point for the current year in number of video disks. (Round your answer to the nearest whole number.) Break-even point units 2. What will be the company's net income for the current year if there is a 15 percent increase in projected unit sales volume? (Omit the "$" sign in your response.) Net income $ 3. What volume of sales (in dollars) must Disk City achieve in the coming year to maintain the same net income as projected for the current year if the unit selling price remains at $19? (Do not round intermediate calculations and round your final answer to 2 decimal places. Omit the "$" sign in your response.) Volume of sales $ 4. In order to cover a 30 percent increase in the disk's purchase price for the coming year and still maintain the current contribution-margin ratio, what selling price per disk must Disk City establish for the coming year? (Do not round intermediate calculations and round your final answer to 2 decimal places. Omit the "$" sign in your response.) Selling price $ [The following information applies to the questions displayed below.] Corrigan Enterprises is studying the acquisition of two electrical component insertion systems for producing its sole product, the universal gismo. Data relevant to the systems follow. Model no. 6754: Variable costs, $17.00 per unit Annual fixed costs, $986,100 Model no. 4399: Variable costs, $11.80 per unit Annual fixed costs, $1,114,000 Corrigan's selling price is $62 per unit for the universal gismo, which is subject to a 5 percent sales commission. (In the following requirements, ignore income taxes.) 2.value: 10.00 points Required: 1. How many units must the company sell to break even if Model 6754 is selected? (Do not round intermediate calculations and round your final answer to the nearest whole number.) Break-even point units 3.value: 10.00 points 2-a. Calculate the net income of the two systems if sales and production are expected to average 44,000 units per year. (Omit the "$" sign in your response.) Net Income Model 6754 $ Model 4399 $ ---------------------------------------------------------------------- 2-b. Which of the two systems would be more profitable? Model 4399 Model 6754 4.value: 10.00 points 3. Assume Model 4399 requires the purchase of additional equipment that is not reflected in the preceding figures. The equipment will cost $450,000 and will be depreciated over a five-year life by the straight-line method. How many units must Corrigan sell to earn $961,000 of income if Model 4399 is selected? As in requirement (2), sales and production are expected to average 44,000 units per year. (Do not round intermediate calculations and round your final answer to the nearest whole number.) Required sales units 5.value: 10.00 points 4. Ignoring the information presented in part (3), at what volume level will the annual total cost of each system be equal? (Round your answer to the nearest whole number.) Volume level units
Checkers also sold 2,150 units during the month. Using the average cost method, what is the amount of cost of goods sold for the month? A. $27,843. B. $28,950. C. $26,975. D. $27,950.
Issued $600,000 face value Sloan Co. second mortgage, 8% bonds for $654,120, including accrued interest. Interest is payable semiannually on December 1 and June 1 with the bonds maturing 10 years from this past December 1. The bonds are callable..
Compare and contrast the five types of analytical procedures. Determine for which situations each is best suited. Defend your answer.
What are the steps of the accounting cycle? Why is it necessary to make adjusting entries at the end of each accounting period? What would happen if all of the steps of the accounting cycle were not completed in a specific accounting period?
Would your answers to (a) and (b) change if Gabriella originally contributed the property to the partnership in 1999?
Accompanying the bank statement was a debit memo for an NSF check received from a customer. What entry is required in the company's accounts?
Assume that the client company, which handled some government contracts, had no internal auditors for a federal agency spent three weeks auditing the records and were just completing their work at this time.
Global sells $1,350,000 face value of convertible bonds at a price of 101.Global realizes proceeds of $ 1,363,500.The ten year bonds carry an interest rate(coupon rate) of 6% with interest paid semi annually.
On August 1, it distributed property with an adjusted basis of $5,000 and a fair market value of $8,000 to its sole shareholder, Pedro Urritia. How much of the distribution will be treated as a dividend?
Sue ask for you to prepare a well organized and formatted schedule showing what the variable manufacturing cost is as a percentage of total sales for each of the three product sales for 2007.
Phillips Company bought 40 percent ownership in Jones Bag Company on January 1, 20X1, at underlying book value. In 20X1, 20X2, and 20X3, Jones Bag reported net income of $8,000, $12,000, and $20,000
The St. Augustine Corporation originally budgeted for $360,000 of fixed overhead. Production was budgeted to be 12,000 units. The standard hours for production were 5 hours per unit.
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