Item 1 item 1 part 1 of 5 10 points required information understanding account and financial information - goodwill goodwill is a nonprofit organization designed to those that are in need. despite the fact that goodwill is a nonprofit, it must follow the same basic business principles that for-profit businesses do in order to stay solvent and survive. the accounting activities of the organization are nearly identical to those of for-profit businesses. this video describes the goal of goodwill, and it follows the creation of the financial statements in the accounting cycle. accounting is the recording, classifying, summarizing, and interpreting of financial events and transactions to provide management and other interested parties the information they need to make good decisions. most businesses use a formal accounting cycle to prepare and analyze the major financial statements (balance sheet, income statement, and statement of cash flows). click the ► button to watch the video. then, answer the questions that follow. the main reason that the primary stakeholder of goodwill is the general public is because it

Fanning company is considering the addition of a new product to its cosmetics line. the company has three distinctly different options: a skin cream, a bath oil, or a hair coloring gel. relevant information and budgeted annual income statements for each of the products follow. skin cream bath oil color gel budgeted sales in units (a) 110,000 190,000 70,000 expected sales price (b) $8 $4 $11 variable costs per unit (c) $2 $2 $7 income statements sales revenue (a × b) $880,000 $760,000 $770,000 variable costs (a × c) (220,000) (380,000) (490,000) contribution margin 660,000 380,000 280,000 fixed costs (432,000) (240,000) (76,000) net income $228,000 $140,000 $204,000 required: (a) determine the margin of safety as a percentage for each product. (b) prepare revised income statements for each product, assuming a 20 percent increase in the budgeted sales volume. (c) for each product, determine the percentage change in net income that results from the 20 percent increase in sales. (d) assuming that management is pessimistic and risk averse, which product should the company add to its cosmetics line? (e) assuming that management is optimistic and risk aggressive, which product should the company add to its cosmetics line?