Reference no: EM131294249
Scenario: Jordan and Taylor are beginning to understand break-even analysis.
Selling price to Yumminess at $10 per tin. The cost is $8 per tin, which includes $6 of direct material and $1.50 of direct labor. Annual manufacturing overhead is estimated at $100,000 for the expected sales of 200,000 tins. Operating expenses are projected to be $80,000 annually.
After looking over the costs for manufacturing overhead and operating expenses, you approximate that 85% of manufacturing overhead and 20% of operating expenses are variable costs.
They are now discussing options with adjustments to costs and sales. As long as they keep bringing brownies, you keep turning out numbers.
1. Jordan and Taylor are considering an advertising campaign for $40,000 annually. They expect this to increase sales by 5%. What would be the new net income?
2. Yumminess wants to feature Chocolate Attack Brownies as a monthly special. The predicted sales volume is 50,000 tins. Yumminess wants Jordan and Taylor to cut their selling pricing by 10%, citing that the volume will more than make up the difference. What will be the break-even point in tins during this sale?
3. Yumminess wants to feature Chocolate Attack Brownies as a monthly special. The predicted sales volume is 50,000 tins. Yumminess wants Jordan and Taylor to cut their selling pricing by 10%, citing that the volume will more than make up the difference. What net income can Jordan and Taylor expect during this offer?
|
Task level modeling
: Helpful hints: Please give yourself plenty of time to complete this assignment. First, prepare the flowchart by hand. Then, transfer the flowchart to the computer package. Keep in mind that the creation of the flowchart within a package often takes l..
|
|
Qualified retirement plan included in decedents gross estate
: Under which of the following conditions and to what extent are benefits from a qualified retirement plan included in a decedent’s gross estate?
|
|
The financial statement effects of this action
: Many companies buy back their outstanding stock on an annual basis. List several reasons a company might want to repurchase shares of its stock, as well as the financial statement effects of this action.
|
|
What amount is includible in his gross estate
: John Jamison transferred $200,000 of tax exempt bonds to a trust for the benefit of his grandchildren 2 years ago. He died this year. Assume the gift tax paid was approximately $60,000. What amount is includible in his gross estate. If the transfer w..
|
|
Understand break-even analysis
: Selling price to Yumminess at $10 per tin. The cost is $8 per tin, which includes $6 of direct material and $1.50 of direct labor. Annual manufacturing overhead is estimated at $100,000 for the expected sales of 200,000 tins. Operating expenses are p..
|
|
Product or customer has a negative yellow margin
: If a cost object such as a product or customer has a negative yellow margin, then:
|
|
How would you recommend the building acquisition be recorded
: Sayer Co. entered into a contract woth Bradford Construction Co. for construction of an office building at a cost of $680,000. Upon completion of construction, Bradford agreed to accept in full payment fo the contract price Sayer Co.'s %10 bond with ..
|
|
Prepare journal entries for sales and purchases
: Prepare Journal Entries for Sales and Purchases (With Discounts) Super Copy Co. is an office supply store. The company uses a perpetual inventory system. Record the above transactions in the company's general journal. To conserve space, omit the writ..
|
|
What is the couples marriage penalty or benefit
: In 2014, Lisa and Fred, a married couple, have taxable income of $487,500. If they were to file separate tax returns, Lisa would have reported taxable income of $257,500 and Fred would have reported taxable income of $230,000. Use Tax Rate Schedule f..
|