7.Mr Y has developed a new technique for BEST BURGER and plans to open a take-out restaurant. His brother has agreed to invest Birr 500,000 in the operation provided Mr Y can convince him that profits will be at least 20 percent of sales revenues. Mr Y estimated that total fixed expenses would be Birr 24,000 per year and that variable expenses would be approximately 40 percent of sales revenue. Required a. How much sales revenue must be earned to produce profits equal to 20 percent of sales revenue? Prepare a contribution income statement to verify your answer.
b. If Mr Y plans on selling 12-piece buckets of chicken for Birr 10 each, how many buckets must he sell to earn a profit equal to 20 percent of sales? Twenty-five percent of sales? Prepare a contribution income statement to verify the second answer.
c. Suppose Mr Y’s brother meant that the after-tax profit had to be 20 percent of sales revenue. Under this assumption, how much sales revenue must be generated by Y’s chicken business? (Assume that the tax rate is 40 percent.)

An important application of regression analysis in accounting is in the estimation of cost. by collecting data on volume and cost and using the least squares method to develop an estimated regression equation relating volume and cost, an accountant can estimate the cost associated with a particular manufacturing volume. consider the following sample of production volumes and total cost data for a manufacturing operation. production volume (units) total cost ($) 400 4000 450 5000 550 5400 600 5900 700 6400 750 7000 compute b 1 and b 0 (to 2 decimals if necessary). b 1 b 0 complete the estimated regression equation (to 2 decimals if necessary). = + x what is the variable cost per unit produced (to 1 decimal)? $ compute the coefficient of determination (to 4 decimals). note: report r 2 between 0 and 1. r 2 = what percentage of the variation in total cost can be explained by the production volume (to 2 decimals)? % the company's production schedule shows 500 units must be produced next month. what is the estimated total cost for this operation (to 2 decimals)? $

crow design, inc. is a web site design and consulting firm. the firm uses a job order costing system in which each client is a different job. crow design assigns direct labor, licensing costs, and travel costs directly to each job. it allocates indirect costs to jobs based on a predetermined overhead allocation rate, computed as a percentage of direct labor costs. direct labor hours (professional) 6,250 hours direct labor costs ($1,800,000 support staff salaries ,000 computer ,000 office ,000 office ,000 in november 2012, crow design served several clients. records for two clients appear here: delicious treats mesilla chocolates direct labor 700 hours 100 hours software licensing $ 4,000 $400 travel costs 8,000 1. compute crow design’s direct labor rate and its predetermined indirect cost allocation rate for 2012. 2. compute the total cost of each job. 3. if simone wants to earn profits equal to 50% of service revenue, how much (what fee) should she charge each of these two clients? 4. why does crow design assign costs to jobs?

12. to produce a textured purée, you would use a/an a. food processor. b. wide-mesh sieve. c. immersion blender d. food mill.