What is the impact on operating profit

Assignment Help Accounting Basics
Reference no: EM131894245

Question - Price and cost for Warner Clothing:

Sales price: 15$ per unit

Variable costs: 3$ per unit

Fixed costs: 42000 per month

Assume that the company plans to sell 5000 units per month. Consider requirements b, c, d independently of each other:

a) What will be the operating profit?

b) What is the impact on operating profit if the sales price decreases by 10%? Increase by 20%?

c) What is the impact on operating profit if variable costs per unit decrease by 10%? Increase by 20%?

d) Suppose that fixed cost for the year are 10% lower than projected and variable cost per unit are 10% higher than projected. What impact will this cost changes have on operating profit for the year? Will profit go up or down and how much?

Reference no: EM131894245

Questions Cloud

How does scientific inquiry try to avoid the common pitfalls : Respond to the following: Answer each discussion(X2). Include at least 2 references. A good response to a written question should combine your personal.
Does the contract term of duress apply here : Is the clause that Gene Wilder (the actor) is trying to get them to sign, an exculpatory or liquidated damages clause?
Customer service department : Jim and John will be co-leaders for a work group. Their group will consist of six other members of their Customer Service department.
Leader of an employeer satisfaction committee : Brett has just taken over as the leader of an Employeer Satisfaction Committee. The committee is responsible for administering confidential employee
What is the impact on operating profit : Assume that the company plans to sell 5000 units per month. What is the impact on operating profit if the sales price decreases by 10%? Increase by 20%
Describe the difference between the terms : Which of these three is the most desirable for optimum group functioning? Why?
Prepare a brief on process of selecting information system : During the second week of your internship, the CIO approaches your team and says, "I need you to prepare a briefing on the process of selecting and acquiring.
Describe three reasons group decisions : Describe three reasons group decisions are generally preferable to decisions made by individuals.
What is the amount of accumulated depreciation at december : What is the amount of accumulated depreciation at December 31, 2017, if the straight-line method of depreciation is used

Reviews

Write a Review

Accounting Basics Questions & Answers

  Desirability of accepting an engagement

The client can significantly affect the desirability of accepting an engagement. Key considerations include the following:

  Examine principle in recognition of events

A change in accounting principle results when a company adopts a new principle in recognition of events that were previously immaterial.

  Write about details of clinical nursing

Write about details of Clinical Nursing, Clinical decision making and predictors of patient participation in nursing care.

  A not-for profit nursing home has total expenses of 20

a not-for profit nursing home has total expenses of 20 million. sales tax in the state is 7. expenses are broken down

  Comparing stocks versus bonds

Comparing stocks versus bonds:

  Equal employment opportunity commission

In the U. S. Equal Employment Opportunity Commission (EEOC), they got their wireless carrier to agree to the bundled rate plan with shared minutes.

  Fancy furniture produced a batch of 2000 coffee tables at a

fancy furniture produced a batch of 2000 coffee tables at a cost of 355000. it was discovered that the entire batch was

  Journalize the entry to record the first interest payment

Journalize the entry to record the first interest payment and the amortization of the related bond discount using the straight line method.

  What is the net realizable value of the receivables

At the beginning of the current period, Rose Corp. had balances in Accounts Receivable of $200,000 and in Allowance for Doubtful Accounts of $9,000 (credit).

  Purchase laboratory equipment for gene splicing

BioGen Company, a small biotechnology firm, would like to borrow a loan to purchase laboratory equipment for gene splicing. The loan carries an interest rate of 8% per year and is to be repaid $396,719 at the end of 6 years. How much is the loan?

  What is amount of lease liability recorded on balance sheet

Under existing U.S. GAAP, what is the amount of lease liability recorded on the balance sheet at January 1, 2016

  Compute the amount of the lease receivable round present

wadkins company a machinery dealer leased a machine to romero corporation on january 1 2012. the lease is for an 8-year

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