Pfitz Company is studying the impact of the following: 1. An increase in sales price on the break-even point.2. A decrease in fixed costs on the contribution margin.3. An increase in the contribution margin on the break-even point.4. A decrease in the variable cost per unit on the sales volume needed to achieve Pfitz's $68,000 target profit.5. An increase in sales commissions on the contribution margin and the break-even point.6. A decrease in anticipated advertising outlays on fixed cost and the break-even point.Required: Determine the impact of these operating changes (increase, decrease, no effect) on the item(s) noted.
What will be an ideal response?
| 1. Decrease | 4. Decrease |
| 2. No effect | 5. Decrease, increase |
| 3. Decrease | 6. Decrease, decrease |
You might also like to view...
Excerpts from cost-volume-profit analysis of Nutshell Inc indicate fixed costs of $85,000, a contribution margin per unit of $40, a selling price of $95, and a sales level of 4,000 units. What must be the targeted level of profit?
A) $116,875 B) $103,125 C) $85,000 D) $75,000
Mace and Bowen are partners and share equally in income or loss. Mace's current capital balance is $135,000 and Bowen's is $120,000. Mace and Bowen agree to accept Kent with a 30% interest in the partnership. Kent invests $115,000 in the partnership. The amount credited to Kent's capital account is:
A. $115,000. B. $119,000. C. $111,000. D. $92,500. E. $120,000.
A juice company promotes its product as an alternative to a full breakfast, which many people
skip in their hurry to reach work in the morning. What sort of segmentation would the juice manufacturer benefit from? A) age B) household type C) lifestyle D) gender
If a promissory note is not presented for payment on the due date, it is discharged
Indicate whether the statement is true or false