Lantern Company is thinking of discontinuing product line F because it is reporting an operating loss. All fixed costs are unavoidable. Lantern Company discontinues product line F and rents the space formerly used to produce product F for $22,000 per year, what affect will this have on operating income? .... O A. Increase $31,000 O B. Increase $41,000 O C. Decrease $14,000 O D. Increase $14.000
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- The following data are taken from the records of Dove Company, a division of Oasis Corporation for the year ended December 31, 2021 Sales 120,000,000.00Less: Variable Cost and Expenses 8,000,000.00Contribution Margin 4,000,000.00Less:: Direct Fixed Cost and Expenses 1,000,000.00Segment Income 3,000,000.00 The company used an average assets of P8,000,000.00 in 2021. The cost of capital is 12% Calculate the following:1. Return on Sales2. Asset Turnover3. ROI4. Residual IncomeGiven the following data: average operating assets $250,000 total liability $100,000 sale $600,000 contribution margin $150,000 net operating income $30,000Oreo reported the following for the period:Sales P1,000,000Cost of Sales P300,000Operating expenses P100,000Determine the OSD assuming that Oreo is a corporation
- 6. .Using the algebraic method, department B's cost allocated to department C is: а. Р 7,794 b. P13,192 c. P14,021 d. P29,021ABC Company has three product lines-D, E, and F. The following information is available: Sales revenue Variable costs D Operating income (loss) E F $90,000 $40,000 $31,000 (40,000) (15,000) (10,000) Contribution $50,000 $25,000 $21,000 margin Fixed costs (20,000) (15,000) (23,000) $30,000 $10,000 $(2000) The company is deciding whether to drop product line F because it has an operating loss. Assuming fixed costs are unavoidable, if ABC drops product line F, what effect will this have on operating income?The following are the respective costs and revenues incurred by USA company: costs for months 1, 2, 3: $80,000.00, $90,000.00, $100,000.00 Revenues for months 2, 3, 4: $70,000.00, $95,000.00 $105,000.00 The USA company wants to know from you if it has made any profit or not. What will be your answer and explain? Use interest= 12%
- Biblio Files CompanyContribution Margin Income StatementFor the Year Ended December 31, 20Y8 Sales $379,000 Variable costs: Manufacturing expense $151,600 Selling expense 15,160 Administrative expense 60,640 (227,400) Contribution margin $151,600 Fixed costs: Manufacturing expense $76,750 Selling expense 8,000 Administrative expense 10,000 (94,750) Operating income $56,850 Sales Mix Biblio Files Company is making plans for its next fiscal year, and decides to sell two new types of bookshelves, Basic and Deluxe. The company has compiled the following estimates for the new product offerings. Type ofBookshelf Sales Priceper Unit Variable Costper Unit Basic $5.00 $1.75 Deluxe 9.00 8.10 The company is interested in determining how many of each type of bookshelf would have to be sold in order to break even. If we think of the Basic and Deluxe products as components of one overall enterprise product called…Bett Inc. has the following 8 units A-H Description A B Assets 50 70 Revenue Profit Units 7 C 40 650 870 350 7.5 3.5 D 60 800 4 E 89 950 9 F 78 750 5 Which units are to be reported as per segmental reporting? Show all calculations with brief explanations to support your answer. G 52 990 3.2 H 46 590 2.8 TOTAL 485 5950 42Biblio Files CompanyContribution Margin Income StatementFor the Year Ended December 31, 20Y8Sales $379,000 Variable costs: Manufacturing expense$151,600 Selling expense15,160 Administrative expense60,640(227,400) Contribution margin $151,600 Fixed costs: Manufacturing expense$76,750 Selling expense8,000 Administrative expense10,000(94,750)Operating income $56,850
- Biblio Files CompanyContribution Margin Income StatementFor the Year Ended December 31, 20Y8 Sales $379,000 Variable costs: Manufacturing expense $151,600 Selling expense 15,160 Administrative expense 60,640 (227,400) Contribution margin $151,600 Fixed costs: Manufacturing expense $76,750 Selling expense 8,000 Administrative expense 10,000 (94,750) Operating income $56,850 Sales Mix Biblio Files Company is making plans for its next fiscal year, and decides to sell two new types of bookshelves, Basic and Deluxe. The company has compiled the following estimates for the new product offerings. Type ofBookshelf Sales Priceper Unit Variable Costper Unit Basic $5.00 $1.75 Deluxe 9.00 8.10 The company is interested in determining how many of each type of bookshelf would have to be sold in order to break even. If we think of the Basic and Deluxe products as components of one overall enterprise product called…Suresh Company reports the following segment (department) income results for the year. Department M Department N Department 0 Department P $ 82,000 $ 44,000 $ 78,000 $ 65,000 Sales Expenses Avoidable Unavoidable Total expenses Income (loss) Department Department M Department N Department O Department P Department T 17,300 45,400 57,800 21,600 75, 100 67,000 $ 6,900 $ (23,000) Decision 18,000 5,700 23,700 $ 54,300 21,500 54,300 75,800 $ (10,800) Department T $ 43,000 51,300 20,300 71, 600 $ (28,600) Total $ 312,000 a. If the company plans to eliminate departments that have sales less than avoidable costs, which department(s) would be eliminated? 153,500 159, 700 313, 200 $ (1,200)Mairy Productions has three models: D, E, and F. The following information is available Model D 100.000 $37,000 $32,000 $20.000 $12,000 Sales revenue Variable expenses Contribution margin Fixed expenses Operating income (loss) Model E $37,000 $14,000 $23.000 $20,000 $3,000 A. Increase $13,000 OB. Decrease $13,000 OC. Increase $18,000 OD. Decrease $18,000 Model F $24,000 $14.000 $10,000 $20,000 ($10,000) Maizy Productions is thinking of discontinuing model F because it is reporting an operating loss. All fixed costs are unavoidable. Assuming Maizy Productions discontinues fine F and is able to double the production and sales of model E without increasing fixed costs. What effect will this have on operating income?