Owens Company manufactures tennis racquets. The selling price per racquet averages $320 and variable costs per...
Owens Company manufactures tennis racquets. The selling price per racquet averages $320 and variable costs per racquet are $190. The sales volume in dollars which produces a net income before taxes of $403,000 is $3,104,000. Calculate variable cost and fixed cost
Homework Answers
| Variable cost: | ||||||||
| Sales volume in $=$ 3104000 | ||||||||
| selling price per racquet=$ 320 | ||||||||
| Sales volume in racquet=3104000/320=9700 racquets | ||||||||
| variable costs per racquet=$ 190 | ||||||||
| Total variable cost=9700*190=$ 1843000 | ||||||||
| Fixed cost: | ||||||||
| Cotribution=Sales volume in $-Total variable cost=3104000-1843000=$ 1261000 | ||||||||
| Contribution-Fixed cost=Net income | ||||||||
| Fixed cost=Contribution-Net income=1261000-403000=$ 858000 | ||||||||
| I appreciate your ratings | ||||||||
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