INB
posted by scooby9132002 .
13. Healthy Foods, Inc. sells 50pound bags of grapes to the military for $10 a bag.
The fixed costs of this operation are $80,000, while the variable costs of the
Grapes are $.10 per pound.
a. What is the breakeven point in bags?
$80,000 = $80,000 = 80,808 units
$10.00  $0.10 $9.90
b. Calculate the profit or loss on 12,000 bags and on 25,000 bags.
12,000 Bags 25,000 Bags
Sales x price per unit 120,000 250,000
Less: Fixed costs 80,000 80,000
Less: Variable cost x per unit 8089 8089
Profit (Loss) 31,911 161,911
Work for 12,000 Bags Work for 25,000 Bags
12,000 x 10= 120,000 25,000 x 10 = 250,000
120,00080,000 = 40,000 250,000 80,000 = 170,000
80,808 x .10 = 8089 80,808 x .10 = 8089
40,0008089= 31,911 170,000 8089 = 161,911
c. What is the degree of operating leverage at 20,000 bags and at 25,000 bags?
20,000 bags DOL = 4.6 25,000 bags DOL = 5.0
Why does the degree of operating leverage change as the quantity sold
Increases?
20,000 + 80,808= 100,808 25,000 + 80,808 = 105,808
100,808 80,000 = 20,808 105, 808 80,000 = 25,808
d. If Healthy Foods has an annual interest expense of $10,000, calculate the
degree of financial leverage at both 20,000 and 25,000 bags.
20,000 bags x $10 = 200,000  $10,000 = 190,000 – 80,000 = 110,000
25,000 bags x $10 = 250,000  $10,000 = 240,000 – 80,000 = 160,000
e. What is the degree of combined leverage at both sales levels?
DCL = % Change in EPS
% Change in Sales

Assistance needed.
Please type your subject in the School Subject box. Any other words are likely to delay responses from a teacher who knows that subject well.
Respond to this Question
Similar Questions

accounting
Can somebody help me figure out how to calculate the profit or loss on 12,000 bags and 25,000 bags in this problem? 
Finance
Healthy Foods, Inc., sells 50pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $80,000, while the variable costs of the grapes are $.10 per pound. a. What is the breakeven point in bags? 
fiance
13. Healthy Foods, Inc., sells 50pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $80,000, while the variable costs of the grapes are $.10 per pound. a. What is the breakeven point in bags? 
health
Healthy Foods, Inc., sells 50pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $80,000, while the variable costs of the grapes are $.10 per pound. a. What is the breakeven point in bags? 
Math
Healthy Foods, Inc., sells 50pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $80,000, while the variable costs of the grapes are $.10 per pound. a. What is the breakeven point in bags? 
Finance
Please help!!! Healthy foods sells 50 lb. bags of grapes to the military for $10. a bag. The fixed costs of this operation are $80,000, while the variables costs of the grapes are .10 per pound. What is the break even point in bags? 
break even analysis
13. Healthy Foods, Inc., sells 50pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $80,000, while the variable costs of the Grapes are $.10 per pound. A .What is the breakeven point in bags? 
BreakEven Analysis
Healthy Food, Inc., sells 50pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $80,000, while the variable coast of the grapes are $.10 per pound. 
Fin 200
Healthy Foods, Inc., sells 50pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $80,000, while the variable costs of the grapes are $.10 per pound. a. What is the breakeven point in bags? 
Finance
Organic Foods Inc. sells 50pound bags of grapes to the public schools for $10 a bag. The fixed costs of this operation are $80,000, while the variable costs of grapes are $.10 per pound. a. What is the breakeven point in bags?