Business, 15.07.2021 16:20 aprilreneeclaroxob0c
Jakara Company is a service firm with current service revenue of $400,000 and a 40% contribution margin. Its fixed costs are $80,000. Maldives Company has current sales of $6,610,000 and a 45% contribution margin. Its fixed costs are $1,800,000.
A. What is the margin of safety for Jakarta and Maldives?
B. Compare the margin of safety in dollars between the two companies. Which is stronger?
C. Compare the margin of safety in percentage between the two companies. Now, which one is stronger?
D. Compute the degree of operating leverage for both companies. Which company will benefit most from a 15% increase in sales? Explain why. Illustrate your findings in an Income Statement that is increased by 15%.
Answers: 2
Another question on Business
Business, 22.06.2019 08:30
What is the equity method balance in the investment in lindman account at the end of 2018?
Answers: 2
Business, 22.06.2019 10:20
What two things do you consider when evaluating the time value of money
Answers: 1
Business, 22.06.2019 21:30
Which of the following results in an increase in the standard of living? a. an increase in unemployment pushes down the cost of production. b. wages go up to correct for the inflation of prices. c. income increases, enabling consumers to buy more goods and services. d. rising production costs drive up the price of goods and services.
Answers: 1
Business, 22.06.2019 22:00
Exercise 2-12 cost behavior; high-low method [lo2-3, lo2-4] speedy parcel service operates a fleet of delivery trucks in a large metropolitan area. a careful study by the company’s cost analyst has determined that if a truck is driven 120,000 miles during a year, the average operating cost is 11.6 cents per mile. if a truck is driven only 80,000 miles during a year, the average operating cost increases to 13.6 cents per mile. required: 1.& 2. using the high-low method, estimate the variable and fixed cost elements of the annual cost of truck operation. (round the "variable cost per mile" to 3 decimal places.)
Answers: 3
You know the right answer?
Jakara Company is a service firm with current service revenue of $400,000 and a 40% contribution mar...
Questions
Biology, 26.08.2019 05:30
Spanish, 26.08.2019 05:30
Mathematics, 26.08.2019 05:30
History, 26.08.2019 05:30
Mathematics, 26.08.2019 05:30
Geography, 26.08.2019 05:30
Mathematics, 26.08.2019 05:30
Biology, 26.08.2019 05:30
Mathematics, 26.08.2019 05:30
