Advanced Cost Accounting Final Project You are contemplating starting up a new business. Before you can go to your local
Posted: Wed Apr 27, 2022 11:25 am
Advanced Cost Accounting Final Project
You are contemplating starting up a new business. Before you can
go to your local banker and apply for a small bus you need to do
some calculations to demonstrate to the banker that you are not a
risky loan applicant. The items b you project your income statement
for the coming year to be, based on sales of 160,000 units.
Sales $ 2,000,000.00
Less: Variable Costs $ 1,400,000.00
Contribution Margin $ 600,000.00
Less: Fixed Costs $ 450,000.00
Operating Income. $ 150,000.00
When you met your uncle (who used to be a banker) for dinner
last week, he told you some pointers that he would other patrons in
a similar situation to you. The items he mentioned you need are
to:
1a) Compute the unit contribution margin and the units that must
be sold to break even. 1b) Suppose that 10,000 units are sold above
the break-even point. What is the profit?
2a) Compute the contribution margin ratio and the break-even
point in dollars. (Round your answer for the contrib 2b) Suppose
that revenues are $87,5000 greater than expected. What would the
profit be?
3) Compute the margin of safety in sales revenue.
4a) Compute the operating leverage
4b) Compute the new profit level if sales are 20% lower than
expected.
5) How many units must be sold to earn a profit equal to 12% of
sales?
6) Assuming your income tax rate is 30%. How many units must be
sold to earn an after-tax profit of $180,000?
Your uncle also said that he was always more willing to lend to
customers who had done their homework (i.e. the it and who appeared
to have their goals in order and seem prepared, so he suggests that
you also prepare a small pow presentation to go over your numbers
with the banker.
Your uncle said he would review your presentation before you
meet with the banker, but he's leaving on a trip tomo You told him
you appreciate the help and that you will send him your final
presentation next week for him to review meeting on May 9th.
REQUIRED: Using the income statement above, prepare both
an excel document AND a powerpoint presentation computations for
the items above. Make your case as to why you should get the
aforementioned loan from the b chosen the various computations
above to prepare you should projected sales not go as
expected.
You are contemplating starting up a new business. Before you can
go to your local banker and apply for a small bus you need to do
some calculations to demonstrate to the banker that you are not a
risky loan applicant. The items b you project your income statement
for the coming year to be, based on sales of 160,000 units.
Sales $ 2,000,000.00
Less: Variable Costs $ 1,400,000.00
Contribution Margin $ 600,000.00
Less: Fixed Costs $ 450,000.00
Operating Income. $ 150,000.00
When you met your uncle (who used to be a banker) for dinner
last week, he told you some pointers that he would other patrons in
a similar situation to you. The items he mentioned you need are
to:
1a) Compute the unit contribution margin and the units that must
be sold to break even. 1b) Suppose that 10,000 units are sold above
the break-even point. What is the profit?
2a) Compute the contribution margin ratio and the break-even
point in dollars. (Round your answer for the contrib 2b) Suppose
that revenues are $87,5000 greater than expected. What would the
profit be?
3) Compute the margin of safety in sales revenue.
4a) Compute the operating leverage
4b) Compute the new profit level if sales are 20% lower than
expected.
5) How many units must be sold to earn a profit equal to 12% of
sales?
6) Assuming your income tax rate is 30%. How many units must be
sold to earn an after-tax profit of $180,000?
Your uncle also said that he was always more willing to lend to
customers who had done their homework (i.e. the it and who appeared
to have their goals in order and seem prepared, so he suggests that
you also prepare a small pow presentation to go over your numbers
with the banker.
Your uncle said he would review your presentation before you
meet with the banker, but he's leaving on a trip tomo You told him
you appreciate the help and that you will send him your final
presentation next week for him to review meeting on May 9th.
REQUIRED: Using the income statement above, prepare both
an excel document AND a powerpoint presentation computations for
the items above. Make your case as to why you should get the
aforementioned loan from the b chosen the various computations
above to prepare you should projected sales not go as
expected.