259) Fast as Lightning is an oil change service drive-through that charges each customer $24.00 for an oil and filter change service. Fast as Lightning has found that it costs its business $16.00 per oil and filter change. Monthly fixed costs are $44,000; current sales are 8,000 services.
a. Compute the breakeven sales in units.
b.Compute Fast as Lightning's margin of safety in units and sales dollars.
c.Compute Fast as Lightning's margin of safety as a percentage.
d.Compute Fast as Lightning's operating leverage factor.
e.Compute Fast as Lightning's % of operating income decline if sales fall by 18%.
260) Mr. Pattison is the managerial accountant at the Beach Bum Surf Shoppe. Mr. Pattison advised the Sales Manager that budgeted sales at the store were 100 units, and the store's breakeven point is 14 units. What is the margin of safety in units at the Beach Bum Surf Shoppe?
261) Mississippi Mile Travel Company is conducting a sensitivity analysis in order to assess the company's margin of safety in units and in dollars. Predicted data indicate that 4,750 travel package sales can be expected while 2,200 package sales are necessary to meet the company's breakeven point. Each travel package costs $3,000. Calculate the company's margin of safety in package units and dollars.
A) 2,200 travel package units; $5,610,000
B) 2,550 travel package units; $7,650,000
C) 3,500 travel package units; $8,010,000
D) 1,575 travel package units; $4,810,000