Find what degree of operating leverage of modern artifacts

Assignment Help Financial Accounting
Reference no: EM132578439

Modern Artifacts can produce keepsakes that will be sold for $140 each. Nondepreciation fixed costs are $1,500 per year, and variable costs are $80 per unit. The initial investment of $4,500 will be depreciated straight-line over its useful life of 5 years to a final value of zero, and the discount rate is 10%.

Question a. What is the degree of operating leverage of Modern Artifacts when sales are $6,160? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Question b. What is the degree of operating leverage when sales are $10,500? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Question c. Why is operating leverage different at these two levels of sales?

Reference no: EM132578439

Questions Cloud

Appreciation for high level of performance : The XYZ Company has just decided to take all of its 200 employees to Las Vegas for a three-day, expense-paid weekend
Ceo of a chain of pizza restaurants : The CEO of a chain of pizza restaurants wishes to initiate a program of CSR to be funded by a 5% levy on the company's operating profit.
Find what happens to the average cash flow from the mine : Now suppose you can costlessly shut down the mine in years of low silver prices. What happens to the average cash flow from the mine?
Reasons for ups superior profitability to fedex : With regard to Strategy Capsule 2.2, what additional data would you seek and what additional analysis would you undertake to investigate
Find what degree of operating leverage of modern artifacts : What is the degree of operating leverage of Modern Artifacts when sales are $6,160? (Do not round intermediate calculations.)
Find what will profits be if sales turn out to be million : What will profits be if sales turn out to be $4.5 million? (Leave no cells blank - be certain to enter "0" wherever required. Do not round intermediate)
Find what npv break-even level of sales if firm pays no tax : Find What is the NPV break-even level of sales if the firm pays no taxes? What is the accounting break-even level of sales if the firm's tax rate is 30%?
Find what is npv break-even level of diamonds sold per year : Compute What is NPV break-even level of diamonds sold per year assuming a tax rate of 21%, a 10-year project life, and a discount rate of 10%?
Determine what must be the variable cost per unit : Determine What must be the variable cost per unit? (Round your answer to 2 decimal places.)Accounting break-even: 5,000 units

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd