ACC 256 Final Parker Company has provided the following data for the most recent year: net operating income, $42,000; fixed expense, $62,000; sales, $260,000; and CM ratio, 40%

1. Parker Company has provided the following data for the most recent year: net operating income, $42,000; fixed expense, $62,000; sales, $260,000; and CM ratio, 40%. What is the company's total contribution margin?

$104,000

2. Redford, Inc. has provided the following data:
   
   Sales price $195 per unit
   Sales 5,650 units
   Fixed cost $293,000
   Variable cost $95 per unit
   
   If the dollar contribution margin per unit is increased by 10%, total fixed cost is decreased by 20%, and all other factors remain the same, net income will (increase/decrease) by...

increase by $115,100.

3. Marino Company is currently selling 11,800 units of its product per month at $17 per unit for total monthly sales of $200,600. The company's variable expenses are $11 per unit and its monthly fixed expenses total $11,800. An increase in the advertising budget of $5,800 is expected to increase its monthly sales by 2,800 units for total monthly sales of $248,200. This proposal will cause net operating income to (increase/decrease) by...

Increase by $11,000

4. Astair, Inc. reported sales of $8,090,000 for the month and incurred variable expenses totaling $5,663,000 and fixed expenses totaling $1,380,000. The company has no beginning or ending inventories. A total of 80,900 units were produced and sold last month. How many units would the company have to sell to achieve a desired profit of $1,287,000?

88,900 units

5. Lester Company has a single product. The selling price is $52 and the variable cost is $26 per unit. The company's fixed expense is $312,000 per month. How many units would the company have to sell to break-even?

12,000 units

6. Lester Company has a single product. The selling price is $46 and the variable cost is $32.20 per unit. The company's fixed expense is $138,000 per month. What is the company's break-even in sales dollars?

$460,000

7. Parker Company has provided the following data for the most recent year: net operating income, $47,000; fixed expense, $38,500; sales, $285,000; and CM ratio, 30%. The company's margin of safety in dollars is...

$156,667

8. If sales increase from $403,000 to $459,420, and if the degree of operating leverage is 6, net operating income should increase by...

84%

Percentage change in sales = ($459,420 − $403,000) ÷ $403,000 = 14.00% x 6 = 84%

9. Parker Company has provided the following data for the most recent year: net operating income, $38,000; fixed expense, $82,000; sales, $240,000; and CM ratio, 50%. What is the company's degree of operating leverage?

3.16

10. Astair, Inc. reported sales of $6,804,000 for the month and incurred variable expenses totaling $4,536,000 and fixed expenses totaling $1,458,800. The company has no beginning or ending inventories. A total of 81,000 units were produced and sold last month. What is the company's degree of operating leverage?

2.80