Question

Jorge Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 60 cents per 16-ounce bottle to retailers, who charge customers 90 cents per bottle. For the year 2017, management estimates the following revenues and costs Sales $2,064,000 Selling expenses-variable $70,000 45,000 Direct materials 440,000 Selling expenses-fixed 300,000 Administrative expenses-variable Administrative expenses-fixed Direct labor 68,400 Manufacturing overhead-variable Manufacturing overhead-fixed 360,000 52,000 637,400 Your answer is partially correct. Try again Prepare a CVP income statement for 2017 based on management's estimates JORGE COMPANY CVP Income Statement (Estimated) For the Year Ending December 31, 2017 Sales 2,064,000 Variable Expenses Cost of Goods Sold Selling Expenses 4 70,000 Administrative Expenses 68,400

Answer 1

Required: A Jorge Company CVP Income Statement (Estimated) For the Year Ending December 31, 2017 Sales 2064000 Variable expenses: Cost of goods sold Selling expenses Administrative expenses 1100000 70000 68400 Total Variable expenses Contribution margin Fixed expenses: Cost of goods sold Selling expenses Administrative expenses Total Fixed expenses 1238400 825600 637400 45000 52000 734400 Net Income 91200 Required: B Variable cost per bottel percentage (Total variable cost/Sales )*100 Total Vaiable cost 1238400 Sales 2064000 Variable cost per bottel percentage 60%

Beverage sold for Variable cost per bottel percentage Variable cost per bottel 0.60 Cent per bottel 60% 0.360 per bottel Breakeven point units Fixed cost/ Contribution margin per unit 734400 0.24 3060000 units Fixed cost Contribution margin perunit Break even point units Breakeven point units Fixed cost/ Contribution margin per unit Fixed cost 734400 Contribution margin ratio Break even point Dollars 0.40 1836000 Dollars Required: C Contribution margin ratio Contribution margin /Sales Contribution margin 0.24 Sales 0.60 Contribtuion margin ratio 40%

Margin safety ratio (Actual sales - Bep Sales)/actual sales |Actual sales- Bep sales Actual sales Margin safety ratio 228000 2064000 11 % Required: D Required sales dollars = (Fixed cost + Required Income)/Contribution margin ratio Fixed cost Required Income Contribution margin ratio Required sales dollars 734400 41600 40% 1940000