Nothing Special   »   [go: up one dir, main page]
Scribd Logo
Upload

Welcome to Scribd!

  • 64 views

    CH 4 Assignment

    Uploaded by

    Mikulas Harvanka
    Gulf Shore Lawn and Garden Maintenance provides lawn and garden services. Lawn maintenance has higher variable costs of $14.40 per hour than garden maintenance's $7.20 per hour. The company's overall contribution margin ratio is 46% and its break-even point is $134,400 in sales or 5,600 hours. To break even, they need 4,480 hours of lawn care and 1,120 hours of garden maintenance. To earn a $53,760 after-tax profit at a 30% tax rate requires $251,269 in sales.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    CH 4 Assignment

    Uploaded by

    Mikulas Harvanka
    64 views3 pages
    Gulf Shore Lawn and Garden Maintenance provides lawn and garden services. Lawn maintenance has higher variable costs of $14.40 per hour than garden maintenance's $7.20 per hour. The company's overall contribution margin ratio is 46% and its break-even point is $134,400 in sales or 5,600 hours. To break even, they need 4,480 hours of lawn care and 1,120 hours of garden maintenance. To earn a $53,760 after-tax profit at a 30% tax rate requires $251,269 in sales.

    Original Title

    Ch 4 Assignment

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Gulf Shore Lawn and Garden Maintenance provides lawn and garden services. Lawn maintenance has higher variable costs of $14.40 per hour than garden maintenance's $7.20 per hour. The company's overall contribution margin ratio is 46% and its break-even point is $134,400 in sales or 5,600 hours. To break even, they need 4,480 hours of lawn care and 1,120 hours of garden maintenance. To earn a $53,760 after-tax profit at a 30% tax rate requires $251,269 in sales.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    64 views3 pages

    CH 4 Assignment

    Uploaded by

    Mikulas Harvanka
    Gulf Shore Lawn and Garden Maintenance provides lawn and garden services. Lawn maintenance has higher variable costs of $14.40 per hour than garden maintenance's $7.20 per hour. The company's overall contribution margin ratio is 46% and its break-even point is $134,400 in sales or 5,600 hours. To break even, they need 4,480 hours of lawn care and 1,120 hours of garden maintenance. To earn a $53,760 after-tax profit at a 30% tax rate requires $251,269 in sales.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 3

    5/15/2021 Assignment Print View

     
    1. Award: 20.00 points
     

    Gulf Shore Lawn and Garden Maintenance provides two general outdoor services: lawn
    maintenance and garden maintenance. The company charges customers $24.0 per
    hour for each type of service, but lawn maintenance has higher variable costs ($14.4
    per hour) than garden maintenance ($7.2 per hour) because of fuel expenses incurred
    to operate lawn-mowing equipment. All employees are paid a fixed monthly salary. A
    contribution format income statement for a recent month for the two services appears
    below. During the month, 8,000 hours of lawn maintenance services and 2,000 hours of
    garden maintenance were provided:

    Lawn Per Garden Per


    Maintenance Hour Maintenance Hour To
    Sales $ 192,000 $ 24.0 $ 48,000 $ 24.0 $ 24
    Variable expenses 115,200 14.4 14,400 7.2 12

    Contribution margin $ 76,800 $ 9.6 $ 33,600 $ 16.8 11

    Fixed expenses 6

    Operating income $ 4

    Required:
    1. Compute the overall CM ratio for the company.

    Overall contribution margin ratio 46 %

    2. Compute the overall break-even point for the company in sales dollars.

    https://ezto.mheducation.com/hm.tpx?todo=c15SinglePrintView&singleQuestionNo=1.&postSubmissionView=13252715848099104&wid=13252716609533941&ro… 1/3
    5/15/2021 Assignment Print View

    Overall break-even
    $ 134,400
    point

    3. Compute the weighted-average CM per hour for the company. (Do not round
    intermediate calculations. Round your answers to 2 decimal places.)

    Lawn Garden
    Care Maintenance
    Weighted average CM per hour $ 7.68 $ 3.36

    4. Calculate the overall break-even point for the company in hours.

    Total break-even point in hours 5,600 hours

    5. At the overall break-even point in total hours, how many hours of each service must
    be provided for the company to break-even?

    Lawn Garden
    Care Maintenance
    Number of hours 4,480 1,120

    6. Calculate the overall sales in dollars required to earn an after-tax profit of $53,760 if
    the tax rate is 30%.

    https://ezto.mheducation.com/hm.tpx?todo=c15SinglePrintView&singleQuestionNo=1.&postSubmissionView=13252715848099104&wid=13252716609533941&ro… 2/3
    5/15/2021 Assignment Print View

    Sales required to achieve after-tax target profit $ 251,269

    References

    Worksheet Learning Learning Objective: 04-09 Compute


    Objective: 04-06 the break-even point for a multi-
    Determine the product company and explain the
    level of sales effects of changes in the sales mix
    needed to on the contribution margin and the
    achieve a desired break-even point.
    target profit.

    https://ezto.mheducation.com/hm.tpx?todo=c15SinglePrintView&singleQuestionNo=1.&postSubmissionView=13252715848099104&wid=13252716609533941&ro… 3/3

    You might also like