Ask Experts Questions for FREE Help !
Ask
    ambdelgado's Avatar
    ambdelgado Posts: 5, Reputation: 1
    New Member
     
    #1

    Apr 16, 2007, 07:44 PM
    cvp analysis changes in variance
    I need help with this assignment any help would be greatly appreciated.

    C-V-P Analysis-Changes in Variables
    Tracy, Inc. estimates that next year's results will be:
    Sales revenue (75,000 units) $900,000
    Less Variable costs (375,000)
    Less fixed costs (300,000)
    Profit $225,000

    Recompute profit, assuming each of the following independent conditions:
    1 A 9% increase in the contribution margin.
    2 An 8% increase in the sales volume.
    3 A 4% decrease in the sales volume.
    4 A 6% increase in variable costs per unit.
    5 A 5% decrease in fixed costs
    6 A 5% increase in fixed costs.
    7 A 12% increase in the sales volume and a 6% increase in fixed costs.
    my solution
    1


    2 75,000 x 8% 6,000
    75,000
    81,000

    3 75,000 x 4% 3,000
    75,000
    72,000

    4 (375,000) x 6% 22,500
    (375,000)
    ($352,500)

    5 (300,000) x 5% 15000
    (300,000)
    $285,000

    6 (300,000) x 5% 15000
    (300,000)
    ($315,000)


    7 75,000 x 12% 9,000
    75,000
    84,000
    goldenbutterfly's Avatar
    goldenbutterfly Posts: 63, Reputation: 8
    Junior Member
     
    #2

    Apr 16, 2007, 11:52 PM
    You have to compute for profit. Use the formula:

    Sales xx
    Less: Variable Costs xx
    Contribution Margin xx
    Less Fixed Costs xx
    Profit xx

Not your question? Ask your question View similar questions

 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Overhead Variance [ 1 Answers ]

Company A uses a standard cost system. Overhead cost information for Product CO for the month of October follows: Total actual overhead incurred $14,750 Fixed overhead budgeted $ 1,800 Total Standard...

CVP analysis for Deer Valley Ski lift [ 1 Answers ]

Deer Valley Lodge, a ski resort in the Wasatch Mountains of Utah, has plans to eventually add five new chairlifts. Suppose that one life costs $2 million, and preparing the slope and installing the lift costs another $1.3 million. The lift will allow 300 additional skiers on the slopes, but there...

Materials price variance [ 1 Answers ]

Cox Engineering performs cement core tests in its lab. The following standards have been set for each core test performed: Standard hours or quantity Standard price or rate Direct Materials: 3 pounds ...

Establishing Standards, Variance Analysis [ 2 Answers ]

:confused: STORY PROBLEM Stellhorn expects to purchase potatoes for a acceptable grade and quality for $0.08 a pound. Stella has determined that it can produce 152 ounces of chips for every 10 pounds. Each bag of chips produced contains 19 ounces of chips. Other direct...


View more questions Search