User Account

All Pages

Prepare a contribution margin income statement

Assignment Help Accounting Basics
Reference no: EM132740744

Problem - Benson Company currently produces and sells 7,800 units annually ofa product that has a variable cost of $10 per unit and annual fixed costs of $420,400. The company currently earns a $71,000 annual profit. Assume that Benson has the opportunity to invest in new labor-saving production equipment that will enable the company to reduce variable costs to $8 per unit. The investment would cause ?xed costs to increase by $10,700 because of additional depreciation cost.

Required -

a. Use the equation method to determine the sales price per unit under existing conditions (current equipment is used).

b. Prepare a contribution margin income statement, assuming that Benson invests in the new production equipment.

Reference no: EM132740744

Questions Cloud

What course of action do you advise the ceo to take : You are the resource manager of Blue Bell Freight, a large trucking company. You have just hired a new driver, Shirley Williams. Shirley is of African American.
Prepare the journal entries to record the payment : Prepare the journal entries to record the payment of interest and the amortization of the discount on December 31, 2016; on June 30, 2017
What the amount that will have in account : R24 000 in an account that pays 7,5% interest per year, compounded monthly. The amount that she will have in her account after three years is?
What are your career goals : What are your career goals? How has this course helped you work toward those goals? What are the top two reasons for becoming involved in various organizations.
Prepare a contribution margin income statement : The company currently earns a $71,000 annual profit. Prepare a contribution margin income statement, assuming that Benson invests in new production equipment
Determine what is the value of the firm : Rate of 5% per year, indefinitely, after year 5. If the company's weighted average cost of capital is 10%, then what is the value of the firm?
What are the main objectives of job analysis : What are the main objectives of job analysis? Design the competency-based job descriptions and job specifications for the recruitment and selection manager.
What legal requirements can apply in meeting situations : What legal and ethical requirements can apply in meeting situations? Outline at least 4 examples. The response must be typed.
What is the budgeted ending cash balance in february : Cash transactions expected during February. The beginning cash balance in February was $50,000. What is the budgeted ending cash balance in February?

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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