What will crane total operating income be next year

Assignment Help Managerial Accounting
Reference no: EM132952971

Crane Company manufactures dog food for distribution in Washington, Oregon, and California. A dog food distributor from Florida has approached Crane and offered to purchase 242000 pounds of dog food for $1.40 per pound.

Crane can produce 2004000 pounds of dog food per year, and its results for last year are as follows:

Sales (1822000 at $1.65) $3006300

Variable costs 1093200

Contribution margin 1913100

Fixed costs 792000

Operating income $1121100

Problem 1: If Crane accepts the offer, it will only be able to sell 1762000 pounds of dog food at the regular price due to its capacity constraints. What will Crane's total operating income be next year if it accepts the offer?

a $1360900
b $1312200
c $1251700
d $2043700

Reference no: EM132952971

Questions Cloud

Prepare the entry on December : On May 1, 2022 the executive exercised one-half (5,000) of these options. Prepare the entry on December 31, 2020 to record the compensation expense
Npv of the merger may differ from expectations : The shareholders of firm A have offered one million shares valued at $10 each to acquire firm B. After the merger is announced, stock A trades for $9 per share.
What is the division Residual Income : Question - The Outdoor Division of World Corporation reported the following results from the past year. What is the division Residual Income
Percentage of the merger gains : XYZ Corp's shares are currently trading at $14 each, but ABC Ltd. is preparing for $20 per share tender offer. XYZ estimates the gain from the merger to be $6 m
What will crane total operating income be next year : Crane Company manufactures dog food for distribution in Washington, What will Crane's total operating income be next year if it accepts the offer?
Estimate the change in a firm eps : Estimate the change in a firm's EPS when it issues $1.5 million at a rate of 10% debt and the proceeds are used to repurchase half of the shares outstanding.
Calculate contribution margin per unit : Question - Robest Industries produces only one product. Selling price, $250 per unit (SP). Calculate contribution margin per unit
How much cash flow before tax and interest would be required : How much cash flow before tax and interest would be required to satisfy both debt and equity holders if: the tax rate is 30%, there is $10 million in common sto
Compute the break-even sales for the current year : Determine the amount of sales (units) that would be necessary under the proposed program to realize the $56,700,000 of operating income

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Describe operating profit margin asset turnover

Describe operating profit margin asset turnover and , and explain how each of these ratios can be used to help division managers improve ROI.

  How many units must watson sell to generate

How many units must Watson sell to generate net operating income of $50,000? Next year, fixed expenses are expected to be $200,000

  Determine what is the return on equity

Needham Pharmaceuticals, An equity multiplier of 1.5. Its sales are $130 million and it has total assets of $60 million. What is its return on equity (ROE)?

  Determine what is the weighted average contribution margin

What is the weighted average contribution margin? XYZ sells two types of trucks, large trucks and small trucks. A large truck sells for $80,000 per unit

  Calculate the overhead rate based on camera hours

The Film Company uses a job-order costing system. The following information pertains to the company's activities for the month of December:

  What does the term working capital refer to

Assume a company pays income taxes. How are revenue and expense cash flows adjusted for income taxes when calculating the net present value?

  What is the net cash flow for the year ending december

What is the Net Cash Flow for the year ending December 31, 2018? create Statement of Cash Flow for the year ending December 31, 2018.

  Prepare a comparison of these two alternatives

Messer Company purchased equipment for $24,000. Prepare a comparison of these two alternatives for the first two years Messer will own the equipment

  Maria chavez owns a catering company that serves food and

maria chavez owns a catering company that serves food and beverages at parties and business functions. chavezs business

  What is the overall sales revenue at break-even

What is the overall sales revenue at break-even? Standlar Company makes wireless speakers. The standard model price is $360 and variable expenses are $210

  Discuss the three costing methods of job order costing

Discuss the three costing methods of job order costing, process costing, and activity-based costing. Wet Suit World is a company that manufactures wet suits

  Gaap and income tax accounting

Describe how they are similar and why there are differences. Also, include specific examples of how and when to apply the principles of both types of accounting.

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