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Break-Even in Sales Revenue Margin of Safety Sports-Reps Inc represents professional athletes and movie and television stars The agency had revenue of $12345000 last year with total variable

Break-Even in Sales Revenue, Margin of Safety Sports-Reps, Inc., represents professional athletes and movie and television stars. The agency had revenue of $12,345,000 last year, with total variable costs of $5,678,700 and ?xed costs of $2,192,400. Required: 1. What is the contribution margin ratio for Sports-Reps based on last year ’ s data? What is the break-even point in sales revenue?2. What was the margin of safety for Sports-Reps last year?

3. One of Sports-Reps ’ s agents proposed that the ?rm begin cultivating high school sports stars around the nation. This proposal is expected to increase revenue by $230,000 per year, with increased ?xed costs of $122,500. Is this proposal a good idea? Explain.

Apr 03 2020 View more View Less

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