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Workshop Solutions Wk11 Ch eleven

 Workshop Alternatives Wk11 Ch 11 Exploration Paper

п»їCHAPTER 11

COST-VOLUME-PROFIT ANALYSIS TO GET DECISION MAKING

Trouble 11. a couple of

SLIP SHOE LTD

Required:

A. Calculate the break-even point.

B. Calculate the quantity of pairs that needs to be sold to achieve a profit of $63 1000. What is the margin to get safety as of this sales level? C. Would it be better to sell 16 000 pairs for a selling price of $180 each or 19 000 pairs at a value of $160? D. In the event that an additional $63 270 can be spent on fixed advertising costs, what amount of dollar revenue must be achieved to generate a new profit of $36 000? Imagine there has been no change in the sales price. E. Believe an income duty rate of 30%. Using the given info, how a large number of pairs of shoes need to be sold to earn an after-tax profit of $37 800?

A. CM=$180 – (22 + 35 & 15 & 18)

=$90 or fifty percent

Break even stage (units)=$1 a hundred and twenty-five 000/90=12 five-hundred units

Make your money back point (dollars)=$1 125 000/0. 50=$2 two hundred and fifty 000

Verify: 12 five-hundred units x $180=$2 two hundred and fifty 000

N. Break even stage + DNP (units)=($1 125 000 & $63 000)/$90 = 13 200 models

Margin of safety=13 2 hundred – 12 500 sama dengan 700 devices

C. Total CM16 000 x ($180-22-35-15-18)=$1 440 1000

Total CM19 000 by ($160-22-35-15-16)= one particular 368 000

Advantage from of sixteen 000 snabel-a $180$ seventy two 000

Deb. Fixed costs=$1 125 500 + $63 270=$1 188 270

Make your money back + DNP=($1 188 270 + $36 000)/0. 50

Sales to earn fresh profit=$2 448 540

$2 448 540/$180= 13 603 units

At the. Before duty net earnings: $37 800/(1 – zero. 30)=$54 1000

$180 x=$90 x + $1 125 000 + $54 1000

$90 x=$1 179 500

X=13 90 pairs of boots

Problem 14. 7

COPELAND HOTELS LTD

Required:

A. Calculate the break-even stage for 2012 and 2013 in total room nights and the number of room evenings of each form of room that needs to be sold at the break-even stage. B. Calculate the number of place nights of every type of place that will have to be sold in 2010 to gain an after-tax profit of $9 744 000. Believe a tax rate of 30%.

A. Deluxe Selection 60 500 / (60 000 & 36 500 + twenty four 000) = 50%

Excellent Suite thirty-six 000 / (60 500 + 36 000 + 24 000) = 30%

Presidential Selection 24 000 / (60 000 & 36 500 + twenty four 000) sama dengan 20%

Deluxe

Suite

Superior

Suite

Presidential Suite

Rate per night

$240

$360

$600

Direct room maintenance costs

80

90

140

Adjustable hotel overhead

20

35

40

Adjustable marketing expenditures

20

31

60

Contribution margin

$120

$200

$360

Total contribution margin to get 10 areas:

($120 by 5) & ($200 x 3) & ($360 back button 2)= $1920

Divided by number of areas 10

Typical contribution margin per room$192

Alternatively, it could be calculated making use of the assumed blend 5: several: 2

5/10($120) + 3/10($200) + 2/10($360) = $192

Therefore break-even number of bedrooms is:

S i9000 = Break-even sales

T = Fixed costs

Weighted average contribution margin every room

S i9000 =$12 180 000 & $5 95 000

$192

S =90 000 room nights

Luxurious Suites90 1000 x 50%= 45 500 room night times

Superior Suites90 000 times 30%= 28 000 area nights

Usa president Suites90 000 x 20%= 18 000 room night times

B. Deluxe Suite 64 000 / (64 500 + 56 000 + 40 000) = forty percent

Superior Collection 56 500 / (64 000 + 56 1000 + forty five 000) = 35%

Usa president Suite 40 000 as well as (64 500 + 56 000 & 40 000) = 25%

Assume the sales mixture is forty five: 35: twenty-five

40/100($120) & 35/100($200) & 25/100($360) sama dengan $208

If the after tax profit is definitely $9 744 000 and the tax level is thirty percent then the just before tax income is:

$9 744 1000 / (1 – zero. 3) = $13 920 000

S i9000 = Sales to make a great after tax profit of $9 744 000

S i9000 = Fixed costs & Profit

Weighted average contribution margin every room

S =$12 one hundred and eighty 000 & $5 100 000 & 13 920 000

$208

S =150 000 room nights

Elegant Suites150 000 x 40%= 60 000 room evenings

Superior Suites150 000 by 35%= 52 500 area nights

Presidential Suites150 1000 x 25%= 37 five-hundred room night times

Deluxe

Suite

Outstanding

Package

Presidential Suite

Total...

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