Healthy Foods Inc.

strong Foods Inc. 1 Healthy Foods Inc. Robert Johnson pentad /200 - Introduction To finance: Harvesting The Money head 8/12/2011 instructor: Joseph Lane Healthy Foods Inc. 2 Healthy Foods, Inc., sells 50-pound bags of grapes to the troops for $10 a bag. The unregenerated cost of this operation ar $80,000, while the variable cost of the grapes are $.10 per pound. a.What is the break-even point in bags? $80, 000 $80,000 BE = $10-$5 = $5 = 16,000 bags b.Calculate the profit or red ink on 12,000 bags and on 25,000 bags.

contribute Variable Fixed be supply cost Total Revenue Operating Income Costs (TVC) (FC) (TC) (TR) (loss) (12,000 x $5) (12,000 x $10) $60,000 $80,000 $140,000 $120,000 ($20,000) (25,000 x $5) (25,000 x $10) $125,000 $80,000 $205,000 $250,000 $45,000 c. What is the degree of direct leverage at 20,000 bags and at 25,000 bags? Why does the degree of operational leverage transmit as the quantity sold increases? 20,000($10 - $5) $100,000 condescension union movement= 20,000($10-$5) - $80,000 = $20,000 = 5 25,000($10 - $5) $125,000 DOL = 25,000($10-$5)- $80,000 = $45,000 = 2.8 Because the father out you entrance from the breakeven point the little the helpings is release to be that is wherefore 20,000 bags has a higher percentage than 25,000 bags. d. If Healthy Foods has an annual...If you want to get a full essay, evidence it on our website: Ordercustompaper.com

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