i Cost-Volume-Profit Analysis CVP exercises The Dell-Sub Shop owns and operates six stores in and ar

i Cost-Volume-Profit Analysis CVP exercises The Dell-Sub Shop owns and operates six stores in and around Minneapolis. You are given the following corporate budget data for next year: Revenues Fixed costs Variable costs $11,000,000 $3,000,000 $7,500,000 10 Variable costs change based on the number of subs sold. 12 Use the blue shaded areas on the ENTERANSWERS tab for inputs. Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the instructions tab you will be 13 marked wrong. 15 Requirements Compute the budgeted operating income for each of the following deviations from the original budget data. 16 (Consider each case independently.) a. Enter all amounts as positive values. Do NOT use parentheses or a minus sign for amounts to be subtracted. b. Refer to the budgeted operating income based on the original budget data in all calculations 1 Determine the budgeted operating income based on the original budget data. 20 2 A 10% increase in contribution margin, holding revenues constant 3 A 10% decrease in contribution margin, holding revenues constant 22 4 A 5% increase in fixed costs 23 5 A 5% decrease in fixed costs 24 6 A 5% increase in units sold 25 7 A 5% decrease in units sold 8 A 10% increase in fixed costs and a 10% increase in units sold 27 9 A 5% increase in fixed costs and a 5% decrease in variable costs 28 10 Which of these alternatives yields the highest budgeted operating income? 26 1 1. Determine the budgeted operating Income based on the original budget data. (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instructions tab you 2 will be marked wrong.) 4 Revenues 5 Variable costs Contribution margin 7 Fixed costs 8 Budgeted operating Income 10 2. A 10% Increase in contribution margin, holding revenues constant (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instructions tab you 11 will be marked wrong.) 12 13 Revenues 14 Variable costs 15 Contribution margin 16 Fixed costs 17 Budgeted operating income 19 3. A 10% decrease in contribution margin, holding revenues constant (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instructions tab you will be marked wrong.) 22 Revenues 23 Variable costs 24 Contribution margin 25 Fixed costs 26 Budgeted operating income 27 28 4. A 5% increase in fixed costs (Always use cell references and formulas where appropriate to receive full credit. Cell references B 4.A 5% Increase in fixed costs (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instruction tabs you e will be marked wrong.) Revenues Variable costs Contribution margin Fixed costs – Budgeted operating income – 5. A 5% decrease in fixed costs (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instructions tab you will be marked wrong.) Revenues Variable costs Contribution margin Fixed costs Budgeted operating income 6. A 5% increase in units sold (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instructions tab you will be marked wrong.) Revenues Variable costs Contribution margin Fixed costs Budgeted operating income 55 7. A 5% decrease in units sold (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instructions tab you 56 will be marked wrong.) 58 Revenues 59 Variable costs 60 Contribution margin 61 Fixed costs 62 Budgeted operating income 64 8. A 10% Increase in fixed costs and a 10% increase in units sold (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instructions tab you 65 will be marked wrong.) 67 Revenues 68 Variable costs 69 Contribution margin 70 Fixed costs 71 Budgeted operating income 72 73 9. A 5% Increase in fixed costs and a 5% decrease in variable costs (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instructions tab you 74 will be marked wrong.) 76 Revenues 77 Variable costs 78 Contribution margin 79 Fixed costs 80 Budgeted operating income 81 9. A 5% increase in fixed costs and a 5% decrease in variable costs (Always use cell references and formulas where appropriate to receive full credit. Cell references and formulas should be based on the original data. If you copy/paste from the Instructions tab you will be marked wrong.) Revenues Variable costs Contribution margin Fixed costs Budgeted operating income 10. Which of these alternatives yields the highest budgeted operating Income? Alternative with highest budgeted operating Income

 

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