Compute pattersons contribution margin

Assignment Help Financial Accounting
Reference no: EM13339768

Breakeven analysis and target profit, taxes - Patterson Parkas Company's sales revenue is $30 per unit, variable costs are $19.50 per unit, and fixed costs are $147,000.

a) Compute Patterson's contribution margin per unit and contribution margin ratio.

b) Determine the number of units Patterson must sell to break even.

c) Determine the sales revenue required to earn (pretax) income equal to 20% of revenue.

d) How many units must Patterson sell to generate an after-tax profit of $109,200 if the tax rate is 35%?

e) Patterson is considering increasing its advertising expenses by $38,500. How much of an increase in sales units is necessary from expanded advertising to justify this expenditure (generate an incremental contribution margin of $38,500)?

Reference no: EM13339768

Questions Cloud

How much work is done is done by the normal force : A box of mass 15 kg slides at a constant velocity, along a flat surface, with a coefficient of kinectic friction of 0.75. how much work is done is done by the normal force
Why would a country impose a quota instead of a tariff : Why would a country impose a quota instead of a tariff to restrict imports? and what is an optimal tariff? Give an equation for it. Why don’t countries use it more?
Find the pressure at the oil-water interface in the left arm : A second oil is then poured into the right arm until the two levels are even. A small object (density 0.640 g/cm3 ) is dropped into the second column of oil and it is found to float with 20.0% of its volume above the surface.
Find the magnitude and direction of the net force acting : a charge q= 8 uC is moving along the x axis with a velocity of v=4 x 10^4 m/s. a magnetic field of magnitude B=3T is along the y-axis. a) find the magnitude and direction of the net force acting on the charged particle.
Compute pattersons contribution margin : Compute Pattersons contribution margin per unit and contribution margin ratio - determine the number of units Patterson must sell to break even.
What is the phase difference between the two waves : Two waves traveling on a string in the same direction both have a frequency of 236 Hz, a wavelength of 0.40 m, and an amplitude of 0.14 m. What is the phase difference between the two waves
What is the phase constant in radius of an object : An object is located at -3 cm. If its maximum oscillation amplitude 9cm what is the phase constant in radius
Calculate the magnetic field in the solenoid : A solenoid 27.0cm long and with a cross-sectional area of 0.510cm2 contains 460 turns of wire and carries a current of 90.0A. Calculate the magnetic field in the solenoid
Determine the sales revenue required to earn income : Determine the number of units Patterson must sell to break even and determine the sales revenue required to earn (pretax) income equal to 20% of revenue.

Reviews

Write a Review

Financial Accounting Questions & Answers

  Explain how is the functional currency determined under ifrs

What does th e term functional currency mean? Explain how is the functional currency determined under IFRS and under US GAAP?

  Illustrate what entities or relationships most likely need

Illustrate what entities and/or relationships most likely need to be included in a query to portray the unfilled purchase orders made by each purchasing agent?

  Evaluate the deferred tax asset or liability

Purpose a schedule comparing depreciation for financial reporting and tax purposes. Evaluate the deferred tax asset or liability at the end of 2012.

  What is shown on schedule

What is shown on the schedule? What type of accounting system would seem to be required to produce this information? What type of knowledge, skills, and abilities would seem to be required to produce this form?

  Illustrate what interest rate would firm want to refinance

Illustrate at what interest rates would the firm want to refinance? If the dividend yield drops to 8 percent, how long will it take before the present value of the interest savings exceeds the cost of refinancing?

  Explain how much in personal taxes will ernest need to pay

Ernest, an individual, receives $100 from Vernon Corp. in dividends and is in the 28% tax bracket. Vernon Corp. already paid corporate taxes on the $100 at a 20% tax rate. Explain how much in personal taxes will Ernest need to pay?

  Compute the current weighted average cost of capital

Calculate the project's initial, time 0 cash  flow, taking into account all side effects and compute the current weighted average cost of capital (WACC) of DEI. Show all workings and state clearly the assumptions underlying your computations.

  Financial instrument is a debt or equity security

Discuss five factors that may be employed to determine if a particular financial instrument is a debt or equity security.

  Why do you think home depot is paying out

Why do you think Home Depot is paying out only about 38 percent to 67 percent of its net income to stockholders in the form of cash dividends?

  Prepare bank reconciliation for donovan company

Prepare bank reconciliation for Donovan Company for September which reconciles the balance per books and the balance per bank to their adjusted accurate balances.

  Basic earnings per share

Exercisable at the option price of $25 per share: average market price in 2011, $30 84000 shares instructions compute (a) basic earnings per share, nd (b) diluted earnings per share.

  Prepare the consolidated financial statements

Prepare the consolidated financial statements for 20X3 using the direct method. Using the deferral method, prepare a statement of revenues and expenses and a statement of changes in net assets for Wise Owls for 20X1.

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