The Following Monthly Budgeted Data Are Available for the International

question 104

Essay

The following monthly budgeted data are available for the International Company:
$\begin{array}{|l|r|r|r|}\hline & \text { Product A } & \text { Product B } & \text { Product C } \\\hline \text { Sales } & \$ 500,000 & \$ 300,000 & \$ 900,000 \\\hline \text { Variable expenses } & \underline{300,000} & 210,000 & \underline{720,000} \\\hline \text { Contribution margin } & \$ 200,000 & \$ 90,000 & \$ 180,000 \\\hline\end{array}$
Budgeted operating income for the month is $220,000.
Required:
a)Calculate the break-even sales for the month.
b)Calculate the margin of safety.
c)Calculate the degree of operating leverage.

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Definitions:

Cognitive Therapy

A type of psychotherapy that focuses on changing negative patterns of thought to alter unwanted behavior patterns or treat mood disorders such as depression.

Systematic Desensitization

A therapeutic method used to reduce phobia or anxiety through gradual exposure to the feared object or situation combined with relaxation techniques.

Classical Conditioning

A learning process that occurs when two stimuli are repeatedly paired; a response that is at first elicited by the second stimulus is eventually elicited by the first stimulus alone.

Unconditional Positive Regard

A concept in psychology, particularly within humanistic therapy, where the therapist offers the client acceptance and support regardless of what the client says or does.