Friday
August 1, 2014

Homework Help: Business Finance

Posted by GypsyQueen on Sunday, October 30, 2011 at 10:37pm.

Immediate help needed for the following two questions: 15-12A. (Break-even point) You are a hard-working analyst in the office of financial operations for a manufacturing firm that produces a single product. You have developed the following cost structure information for this company. All of it pertains to an output level of 10 million units. Using this information, find the break-even point in units of output for the firm.

Return on operating assets = 25%
Operating asset turnover = 5 times
Operating assets = $20 million
Degree of operating leverage = 4 times




15-13A. (Break-even point and operating leverage) Allison Radios manufactures a complete line of radio and communication equipment for law enforcement agencies. The average selling price of its finished product is $180 per unit. The variable cost for these same units is $126. Allison
Radios incurs fixed costs of $540,000 per year.

a. What is the break-even point in units for the company?
b. What is the dollar sales volume the firm must achieve in order to reach the break-even
point?

c. What would be the firmís profit or loss at the following units of production sold:
12,000 units? 15,000 units? 20,000 units?

d. Find the degree of operating leverage for the production and sales levels given in part (c).

Answer this Question

First Name:
School Subject:
Answer:

Related Questions

Finance - You are a hard-working analyst in the office of financial operations ...
accounting - You are a hard-working analyst in the office of financial ...
Business Finance - Break Even Analysis.. consider the following income ...
Accounting: Break even point - How much profit increase for every unity sold ...
Business - I need examples of the following and i'll do them over. 1.Assume you ...
finance (firm's net income) - If a firm has a break-even point of 20,000 units ...
Finance - Allison Radios manufactures a complete line of radio and communication...
Finance - A financial analyst tells you that investing in stocks will allow you ...
accounting/ Finance - Break-even point. Please help me understand how to get the...
Accounts - A manufacturing Company produces 2 products Ė A and B. The following ...

Search
Members