Omar Industries manufactures two products: Regular and Super. The results of operations for 20x1 follow.UnitsRegular10,000Sales revenueLess: Cost of goods sold$ 240,000180,000Gross MarginLess: Selling expensesOperating income (loss)$ 60,00060,000$ 0Super3,700$740,000481,000$ 259,000134,000Total13,700$ 980,000661,000$ 319,000194,000$ 125,000$ 125,000Fixed manufacturing costs included in cost of goods sold amount to $3 per unit for Regular and $20 per unit for Super. Variable selling expenses are $4per unit for Regular and $20 per unit for Super; remaining selling amounts are fixed.Omar Industries wants to drop the Regular product line. If the line is dropped, company-wide fixed manufacturing costs would fall by 10% because thereis no alternative use of the facilities. What would be the impact on operating income if Regular is discontinued?Multiple Choice$10,400 increase

Answered: Omar Industries manufactures two…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The following information is available for Bramble Corp.: Sales Cost of goods sold $520000 0 0 0 0 300000 Total fixed expenses A CVP income statement would report contribution gross profit of $220000. contribution gross profit of $260000. Total variable expenses margin of $260000. margin of $370000. $150000 260000
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Omar Industries manufactures two products: Regular and Super. The results of operations for 20x1 follow. Regular Super Total Units 16,000 3,000 19,000 Sales revenue $ 352,000 $ 690,000 $ 1,042,000 Less: Cost of goods sold 252,000 420,000 672,000 Gross Margin $ 100,000 $ 270,000 $ 370,000 Less: Selling expenses 100,000 143,000 243,000 Operating income (loss) $ 0 $ 127,000 $ 127,000 Fixed manufacturing costs included in cost of goods sold amount to $2 per unit for Regular and $15 per unit for Super. Variable selling expenses are $3 per unit for Regular and $15 per unit for Super; remaining selling amounts are fixed. If Omar Industries eliminates Regular and uses the available capacity to produce and sell an additional 1,600 units of Super, what would be the impact on operating income?
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MC Qu. 14-59 Omar Industries manufactures two products... Omar Industries manufactures two products: Regular and Super. The results of operations for 20x1 follow. Units Regular Super Total 13,000 3,900 16,900 $338,000 $819,000 $1,157,000 260,000 468,000 728,000 Sales revenue Less: Cost of goods sold Gross Margin $ 78,000 $351,000 $ 429,000 78,000 280,000 Less: Selling expenses Operating income (loss) 358,000 71,000 0 $ 71,000 $ Fixed manufacturing costs included in cost of goods sold amount to $3 per unit for Regular and $30 per unit for Super. Variable selling expenses are $4 per unit for Regular and $30 per unit for Super; remaining selling amounts are fixed. Omar Industries wants to drop the Regular product line. If the line is dropped, company-wide fixed manufacturing costs would fall by 10% because there is no alternative use of the facilities. What would be the impact on operating income if Regular is discontinued? Multiple Choice $0. $15,600 Increase. $26,000 Increase. $49,400…
A U Ltd manufactures and sells a single product, the company's sales and expenses for themonth of January 2021 were as follows:Total (Kshs)Value per unit (Kshs)Sales1.200.0080.00Less: Variable expenses840.0056.00Contribution360.0024.00Less: Fixed expenses300.00Net income60.00Required:What is the monthly breakeven point in units and in shillings?What is the total contribution margin at breakeven point?How many units would be sold each month to carn a minimum target net income ofkshs. 36.000?(iv)Using the original data, compute a company's margin of safety in both shilling and in percentage termsWhat is the contribution margin ratio, if the monthly sales increase by Kshs 16,000?
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