Maria's Food Service provides meals that nonprofit organizations distribute to handicapped and elderly people. Here is her forecasted income statement for April, when she expects to produce and sell 3,900 meals: Sales revenue Costs of meals produced Gross profit Administrative costs Operating profit Per Unit $6.90 4.95 $1.95 0.80 $ 4,485 $ 1.15 Sales revenue Variable costs: Meals Administrative Contribution margin Fixed costs Operating profit Amount $ 26,910 19,305 Fixed costs included in this income statement are $7,605 for meal production and $780 for administrative costs. Maria has received a special request from an organization sponsoring a picnic to raise funds for the Special Olympics. This organization is willing to pay $3.95 per meal for 300 meals on April 10. Maria has sufficient idle capacity to fill this special order. These meals will incur all of the variable costs of meals produced, but variable administrative costs and total fixed costs will not be affected. Status Quo 3,900 Units $ 7,605 3,120 Required: a. What impact would accepting this special order have on operating profit? (Select option "higher" or "lower", keeping Status Quo as the base. Select "none" if there is no effect. Alternative 4,200 Units Difference

Maria's Food Service provides meals that nonprofit organizations distribute to handicapped and elderly people. Here is her forecasted income statement for April, when she expects to produce and sell 3,900 meals: Sales revenue Costs of meals produced Gross profit Administrative costs Operating profit Per Unit $6.90 4.95 $1.95 0.80 $ 4,485 $ 1.15 Sales revenue Variable costs: Meals Administrative Contribution margin Fixed costs Operating profit Amount $ 26,910 19,305 Fixed costs included in this income statement are $7,605 for meal production and $780 for administrative costs. Maria has received a special request from an organization sponsoring a picnic to raise funds for the Special Olympics. This organization is willing to pay $3.95 per meal for 300 meals on April 10. Maria has sufficient idle capacity to fill this special order. These meals will incur all of the variable costs of meals produced, but variable administrative costs and total fixed costs will not be affected. Status Quo 3,900 Units $ 7,605 3,120 Required: a. What impact would accepting this special order have on operating profit? (Select option "higher" or "lower", keeping Status Quo as the base. Select "none" if there is no effect. Alternative 4,200 Units Difference

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter15: Choice Of Business Entity—other Considerations

Section: Chapter Questions

Problem 71P

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Maria's Food Service provides meals that nonprofit organizations distribute to handicapped and elderly people. The following is her forecasted income statement for April, when she expects to produce and sell 2,900 meals: Amount Per Unit Sales revenue $ 17,110 $ 5.90 Costs of meals produced 12,905 4.45 Gross profit $ 4,205 $ 1.45 Administrative costs 2,320 0.80 Operating profit $ 1,885 $ 0.65 Fixed costs included in this income statement are $4,321 for meal production and $580 for administrative costs. Maria has received a special request from an organization sponsoring a picnic to raise funds for the Special Olympics. This organization is willing to pay $3.45 per meal for 300 meals on April 10. Maria has sufficient idle capacity to fill this special order. These meals will incur all of the variable costs of meals produced, but variable administrative costs and total fixed costs will not be affected. Required: a. What…
Maria's Food Service provides meals that nonprofit organizations distribute to handicapped and elderly people. The following is her forecasted income statement for April, when she expects to produce and sell 4, 000 meals: Amount Per Unit Sales revenue $ 28,000 $7.00 costs of meals produced 20,000 5.00 Gross Profit $ 8,000 $ 2.00 Administrative costs 3,200 .08 Operating profit $ 4,800 $ 1.20 Fixed costs included in this income statement are $6,400 for meal production and $800 for administrative costs. Maria has received a special request from an organization sponsoring a picnic to raise funds for the Special Olympics. This organization is willing to pay $4.00 per meal for 300 meals on April…
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Julianna Abdallah owns and operates FirstCakes, a bakery that creates personalized birthday cakes for a child’s first birthday. The cakes, which sell for $56 and feature an edible picture of the child, are shipped throughout the country. A typical month’s results are as follows: Sales revenue $749,280 Variable expenses 561,960 Contribution margin 187,320 Fixed expenses 133,000 Operating income $ 54,320 How many cakes will Julianna Abdallah have to sell if she wants to earn $171,654 in operating income each month? cakes LINK TO TEXT LINK TO VIDEO Assuming a 30% tax rate, how many cakes will Julianna Abdallah have to sell if she wants to earn $74,284 in net income each month? (Round answer to 0 decimal places, e.g. 5,275.) cakes
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