Operating leverage-margin of safety and cost behavior

Assignment Help Managerial Accounting
Reference no: EM1348885

What is the accounting concept to explain how a 3% decline in sales could cause a 21% decline in profits. Also, discuss the effect of declining sales on an organization's margin of safety.

Reference no: EM1348885

Questions Cloud

Methods used to incorporate indirect costs : Explain the methods that are used to incorporate a portion of the indirect costs into the cost of the product or service.
Egoistic model of altruism : Can you think of situations when the egoistic model of altruism seems most likely correct? What about the empathy-altruism hypothesis?
Authority to subordinate managers and employees : Delegating greater authority to subordinate managers and employees is which
Calculate the percentage increase in real gdp per person : Use the data on U.S. real GDP below to compute real GDP per person for each year. Then use these numbers to calculate the percentage increase in real GDP per person from 1987 to 2005.
Operating leverage-margin of safety and cost behavior : What is the accounting concept to explain how a 3% decline in sales could cause a 21% decline in profits. Also, discuss the effect of declining sales on an organization's margin of safety.
Find magnitude of the acceleration of the suspended masses : Regarding the Earth and a cloud layer 750 m above the Earth as the "plates" of a capacitor, calculate the capacitance. Assume the cloud layer has an area of 1 km2 and that the air between cloud and ground is pure and dry.
Organizational structure and departmentalization : Describe the difference between Authority and Power and explain the 5 types of power
Program to prompts user for integer and print prime number : Give a program which will compile in VS 2010. Write a program to prompts user for integer and then prints out all prime numbers up to that integer.
Humanistic-existentialist theorists : Describe one Humanistic/Existentialist theorist (Maslow, Rogers, or May) and their theory. You can use the questions you used in your paper if you wish.

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Different types of budgets

What are some of the different types of budgets? Explain in detail one kind of budget covered in the text. Explain what the budget is employed for and what information it provides the business.

  Construct the companys direct labor budget

Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.

  Differences in flexible and static budget

You're in the job interview and your possible employer asks you to explain the differences between the flexible and static budget and to explain which you would recommend for the small business and why. How would you respond to this potential empl..

  Managerial accounting-importance of price and volume

Why is it important to investigate both price (rate) and volume (efficiency) variances when rewarding employees for satisfactory work when performance evaluations are based on meeting budgets?

  Edge worth box and pareto efficiency

How a Pareto Superior allocation can be achieved that will help some people without hurting others. Make sure you define efficiency and Pareto Superiority.

  Cash convesion cycle for diciolla company

The DiCiolla Co has sales of $12 million, CGS of $9 MM, and has $2.5 MM of inventory. Receivables are $750,000, payables are $666,667 and the company pays its payables in 30 days.

  Breakeven cvp changes in operating income

Compute the firm's current contribution margin ratio and break-even in revenues. Recalculate contribution margin ratio and breakeven in sales if new machine is leased. What is the firm's operating income supposing that the new machine is leased?

  Preparing budget-top-down and bottom-up approach

Recognize and explain a project where the top-down budgeting approach would be most appropriate. Detail your rationale for decision and list the advantages for using that approach.

  Cvp analysis of detroit disk

Detroit Disk, Inc. is a retailer for digital video disks. The projected net income for the current year is $600,000 based on a sales volume of 400,000 video disks. Calculate Detroit Disk's break-even point for the current year in number of video di..

  Three planned promotion displays

Home Auto has not yet purchased any of the promotion items for next week. Should management substitute the Armadillo car wax for one of the three planned promotion displays? If so, which one?

  Cost behaviour-scatter diagram

Phenix Corporation reports following information regarding its sales and cost of sales. Draw the estimated line of cost behavior by using the scatter diagram, and evaluate fixed costs and variable costs per unit sold.

  Cash conversion cycle-currency-demand deposits

Illustrate out the term cash conversion cycle (CCC), and describe why, holding other things constant, a firm's profitability would raise if it lowered its CCC.

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