Question

Following is relevant information for Snowdon Sandwich Shop, a small business that serves sandwiches: Total fixed cost per month Variable cost per sandwich Sales price per sandwich $1,180.00 1.00 6.00 00:4146 During the month of June, Snowdon sold 580 sandwiches. Complete the contribution margin income statement for the month of June. (Round your final answers to the nearest whole dollar.) SNOWDON SANDWICH SHOP Contribution Margin Income Statement Month of June 13 Contribution Margin Net Operating Income

Answer 1

SNOWDON SANDWICH SHOP contribution margin Income statement -Month of June Amount (6) Sales (580 x 6) a 3.480 Less: variable cost ( 580 x 1 580 Contribution Margin 2900 'Less: fixed cost 1180 i Net Openating margin 1,720

2) Sood selling price per unit = $13.00 variable cost pen unit: $5.20 o contribution Margin per unit = (selling price per unit- . Variable east per unit) ( 13 - 5.20) = $ 7.80 perumi o Red Hawk's contribution Margin Ratio" a Contribution per unitana. Sales = 780 x100 -60

# If Red Hawks sells a 2100 clocks. them, Total Contribution Margin Sales (2100X13) = $ 27.300 lessi variable costs (2100 X 520) = 10920 Total contribution $ 16,386 OR Selling price = (2100 X 13) 5 $27,300 Contribution Margin Ratio - 60%. ... Contribution for 200 clocks. Sell (27300 X 60%) = $16,380 (Answer) ANSWER Red Hank's 'unit contribution Margin = $7.80 per unit o Red Hawk's contribution Margin Ratio = 60°l. by Total contribution of Red Hawk's (2100 Clock a $ 16,380 Seus)