Should harder company give a commission to its salesmen

Reference no: EM13567668

Harder Company manufactures a product that sells for $50 per unit. Harder incurs a variable cost per unit of $35 and $2,400,000 in total fixed costs to produce this product. It is currently selling 200,000 units.

a) Compute and label the contribution margin per unit and contribution margin ratio.

b) Using the contribution margin per unit, compute the break-even point in units.

c)Using the contribution margin ratio, compute the break-even point in dollars.

d) Compute the margin of safety and margin of safety ratio.

e) Compute the number of units that must be sold in order to generate net income of $300,000 using the contribution margin per unit.

f) Should Harder Company give a commission to its salesmen based on 10% of sales, if it will decrease fixed costs by $400,000 and increase sales volume 20%? Support your answer with labeled computations.

Reference no: EM13567668

Questions Cloud

Samson corporation is in the process of setting a selling : samson corporation is in the process of setting a selling price for a new product it has just designed. the following

Rank the following according to the degree of credit risk : 1 rank the following according to the degree of credit risk highest credit risk 1 lowest credit risk 4i advances

Presented below is information related to kienholz company : presented below is information related to kienholz company for its first month of operations. credit sales cash

Moss manufacturing has just completed a major change in its : moss manufacturing has just completed a major change in its quality control process. previously products had been

Should harder company give a commission to its salesmen : harder company manufactures a product that sells for 50 per unit. harder incurs a variable cost per unit of 35 and

Calculate liquid ratio from the : calculate liquid ratio from the followingnbsprscash15000bills receivable20000stock22000creditors17000outstanding

After reading pauls case and the notes on literary elements : question 1- after reading pauls case and the notes on literary elements which elements do you think stand out most in

Luke who retired this year lives in a four-plex owned by : luke who retired this year lives in a four-plex owned by julie. lukes income decreased when he retired and he now has

Emilio alvarez and gracila zavala joined together to form a : 1.what are the main advantages of a proprietorships b partnerships and c limited liability companies?2.what are the

User Account

All Pages