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Will a 15 percent change in sales will result in a 15 percent change in net income?
The only situation where this could occur if you had no overhead. Overhead expenses are the expenses just for the business to stay open: like rent, electricity, telephone, insurance, for example. Overhead expenses are relatively fixed in relation to sales level, for small changes in sales (like 15%). With large enough increases, you might have to move into a bigger space, and pay more rent or hire additional staff, for example.
So assume that a business does have overhead, and for simplicity let's say it is a consultant (1 person) who does not sell any materials, which have to be marked up.
Say the overhead is $1000 per month, and sales are $3000 per month for a net profit of $2000 per month. Now increase sales by 15% : $3450 sales per month, less $1000 overhead is $2450 per month. The increase is $450, and percentage change in net profit is 450/2000 = 22.5% increase.
Another example: Say you're a 1 person business with the same $1000/month overhead, but you sell items. Say you double whatever your cost is (if you buy something for $50, then you sell it for $100). Now with the same $3000/month sales, you paid $1500 for the items that you sold + the $1000 overhead = $2500 total costs. So net profit is $500 for the month. With the same 15% increase: $3450 in sales means you spent $1725 for the items + $1000 overhead = $2725. Net profit is now $3450 - $2725 = $725. The profit increase is $725 - $500 = $225, and the percentage profit increase is 225/500 = 45% increase.
What else can I help you with?
Marilyn sales 24 percent of her income. if she saves 960 per month.find her monthly income?
960 x 100/24 ie 4000
What inequality will correctly represent the total sales if the salespersons salary is 700 per month with a 2 percent of the sales and they received a monthly income of at least 1800?
Salary of 700 per month, income of 1800. So the income due to sales is 1800-700=1100. This is 2% = 0.02 of the sales, so the total is 1100/0.02=55000.
What is percent of change?
Percent change is the percent amount some value has changed. It has phenomenal usage in every day math and in fields such as business. It's often used to calculate the percent difference in sales between years for business.
What percent of total tax revenue does the lowest 50 percent?
The answer depends on:what tax (income, sales/value added, inheritance or other)? Different taxes affect different groups differently.in which country?
What is 5 percent sales tax for 19.74?
5 percent sales tax for 19.74 is 0.99
By how much will popcorn sales increase if average income goes up by 18 percent (Assume the income elasticity of popcorn is 3.29.)?
To calculate the increase in popcorn sales due to an 18 percent rise in average income, we can use the formula for income elasticity of demand: Percentage change in quantity demanded = Income elasticity × Percentage change in income. Given an income elasticity of 3.29, the increase in sales would be 3.29 × 18% = 59.22%. Thus, popcorn sales are expected to increase by approximately 59.22%.
If profit margin represents a relationship between net income and net sales what outcome would you predict if there was an increase in net income although no change in net sales?
The excess net income is the result of Interest income or gain in assets or miscellaneous revenue. This type of transactions occur not based on the sales of goods or services. They are deducted after the gross sales (net sales - expenses).
What was the Break even sales if Sales income is 150000 GP is 20 Percent and Net profit is 5000?
600000
In a common size income statement the 100 percent figure is?
The Net Sales
What percent of Mexico's income comes from marijuana?
None of it. Marijuana is illegal in Mexico, and its sales are not counted as part of the national income.
How do you calculate the degree of operating leverage?
DOL is a ratio that is used to identify the changes in the operating leverage that a company requires with growth in sales and income. As and when a company grows and its sales increases, the operating costs also increase and the operating leverage required by the promoters also changes. This ratio helps us identify that value.Formula:DOL = Percentage Change in Net Operating Income / Percentage Change in Sales
Why is the percent of sales method known as the income statement method?
bacause its lower the sale price
Marilyn sales 24 percent of her income. if she saves 960 per month.find her monthly income?
960 x 100/24 ie 4000
Sales is 50000 variable expense 20000 fixed expense 20000 net income 10000 find net income if activity volume increases 10 percent percent?
$13000 or an increase of $3000.
If Sales were 210 now there 731 what is the percent change?
This is a 248.0952% increase.
What kind of sales did Fannie Mae have in 2001?
had sales of $50.8 billion in 2001, reflecting a one-year sales growth of 15.2 percent. Fannie Mae's net income in 2001 was $5.9 million, an increase of 32.5 percent. Freddie Mac saw its sales grow 1.7 percent to $36.7 billion during 2002
What inequality will correctly represent the total sales if the salespersons salary is 700 per month with a 2 percent of the sales and they received a monthly income of at least 1800?
Salary of 700 per month, income of 1800. So the income due to sales is 1800-700=1100. This is 2% = 0.02 of the sales, so the total is 1100/0.02=55000.
