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Barkins Moving Company specializes in hauling heav...




Barkins Moving Company specializes in hauling heavy goods over long distances. The company?s revenues and expenses depend on revenue miles, a measure that combines both weights and mileage. Summarized budget data for the next year are based on predicted total revenue miles of 800,000. At that level of volume, and at any level of volume in between 700,000 and 900,000 revenue miles, the company?s fixed costs are $120,000. The selling price and variable costs are: Per revenue mile Average selling price (revenue) $1.50 Average variable expense $1.30 Please compile all answers in a professional business format??.similar to what you would present to your manager in an employment situation. 1. Compute the budgeted net income. Ignore income taxes. 2. Management is trying to decide how various possible conditions or decisions might affect net income. Compute the new net income for each of the following changes. Consider each case independently. -a. A 10% increase in sales price -b. A 10% increase in revenue miles -c. A 10% increase in variable cost -d. A 10% increase in fixed cost -e. An average decrease in selling price of 3 cents per revenue mile and a 5% increase in revenue miles. Refer to original data -f. An average increase in selling price of 5 cents and a 10% decrease in revenue miles. -g. A 10% increase in fixed expenses in the form of more advertising and a 5% increase in revenue miles.


Paper#6741 | Written in 18-Jul-2015

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