Answer any four questions.4x10=408. A Ltd. Maintains a MOS of 37.5% with an overall contribution to the sales ratio of 40%. Its fixedcosts amount to Rs.5,00,000.Calculate the following:a) Break-Even Salesb) Total Salesc) Total variable costd) Current profite) New MOS if sales volume is increased by7.5%

Step 1: The answers to four questions (answering first four) asked are given as follows:- The fixed…

Answered: Answer any four questions. 4x10=40 8. A…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Q3. Brainteaser Company Ltd has existing sales of INR 1,400 lakhs. Its breakeven sales amount to 60% of its existing sales and the variable costs amount to two and a half times that of contribution, the existing profit of the organization (in INR lakhs) would amount to? Compute the existing profit of the company and show your workings clearly.
XYZ Co. has a contribution margin of $450,000 and profit of $150,000. If sales increase 10%, by how much will profits increase ? а . 15% b. 90% C. None of the given answer is correct. d. 30% e. 60%
Berries Salad has current sales of RM10,000 and a profit margin of 5%. The firm estimates that sales will increase by 4% next year and all costs will vary directly with sales. What is the pro forma net income? Select one: a. RM500.00 b. RM420.00 c. RM405.60 d. RM520.00
XYZ Co. has a contribution margin of $450,000 and profit of $150,000. If sales increase 30%, by how much will profits increase? O a. 15% O b. None of the given answer is correct. С. 30% d. 60% е. 90%
XYZ Co. has a contribution margin of $450,000 and profit of $150,000. If sales increase 20%, by how much will profits increase? а. None of the given answer is correct. O b. 30% O c. 90% O d. 15% е. 60%
Company A makes an operating profit margin of 5 % on sales of R2.5 million. Company B has sales that are 20% higher than Company A and achieves an operating profit margin of 3.5%. Which company makes the highest operating profit? Select one: a. Not possible to calculate b. Company A c. Company B d. Both make the same operating profit
Income is $100,000; revenues are $800,000; investment is $400,000; and the minimum rate of return is 10%. The return on sales is _____. 0.10 0.25 0.50 2.00 none of the above
O e. operating income will decrease. XYZ Co. has a contribution margin of $450,000 and profit of $150,000. If sales increase 5%, by how much will profits increase? O a. 15% O b. 90% 30% O d. 60% O e. None of the given answer is correct. NEXT PAGE AGE Po
Q4. You are given the following data relating to Moynamoti Ltd.: Normal Sales Level (At 100%) 20,000 units; Selling Price Tk.50.00 per unit; Variable Cost Tk.30.00 per unit; Fixed Cost Tk.2,00,000; Tax Rate 40%. Additional Fixed Cost of Tk.40,000 would be required if production exceeds 15% of normal level and in that case Variable Cost would be reduced by Tk.5.00 per unit. Required: a) Calculate BEP in units and in amount at 100% and 120% production levels; b) Prepare Income Statements by analyzing Sales Sensitivity at +/- 10%, 100%, and +/- 20% of normal sales level.
KS. 6 lakhs cost of the product is Rs. 120 per unit and the fixed cost for the year is Rs. 96,000. Illustration 19. A company produces a single product and sells it at Rs. 200 each. The variable + Rs. 24 lakhs) Calculate: (i) P/V ratio. (ii) Sales at break-even point. (iii) Sales units required to earn a target net profit of Rs. 1,20,000. (iv) Sales units required to earn a target net profit of Rs. 1,00,000 after income-tax, assuming income-tax rate to be 50%. Profit at sales of Rs. 7,00,000. (v) Solution
Q1. Sales (30,000 units) Tk.15,00,000 Tk.50 Variable Expense 12,00,000 40 Contribution Margin 300,000 Tk. 10 Fixed Expenses 220,000 Net Operating Income 80,000 Refer to original data. Compute company’s margin of safety in both dollar and percentage form. Compute company’s degree of operating leverage at present level of sales. 7. If sales increase by 7.5%, by what percentage would you expect net operating income to increase?
Margin of Safety Quick Inc. has sales of $36,400,000, and the break-even point in sales dollars is $24,024,000. Determine the company's margin of safety as a percent of current sales. Enter your answer as a whole number. %

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