Homework Answers
When there is no change in the sales volume, an increase in company's per unit contribution margin would increase income of the company.
Correct option is (A)
Increase in company's per unit contribution margin will have no affect on fixed costs of the company. Thus, fixed costs will remain unaffected even due to increase or decrease in per unit contribution margin.
An increase in company's per unit contribution margin with sales volume remaining same as before, would lead to increase in total contribution margin. Increase in total contribution margin with no change in fixed costs, would definitely lead to increase in income of the company.
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7. Assuming no change in sales volume, an increase in company's per-unit contribution margin would: A....
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Requirements 1. What is the company's contribution margin per unit? Contribution margin percentage? Total contribution margin? 2. What would the company's monthly operating income be if the company sold 150,000 units? 3. What would the company's monthly operating income be if the company had sales of $4,500,000? 4. What is the breakeven point in units? In sales dollars? 5. How many units would the company have to sell to earn a target monthly profit of $260,400? 6. Management is currently...
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1.What is the contribution margin per unit? 2.What is the contribution margin ratio? 3.What is the...
1.What is the contribution margin per unit?
2.What is the contribution margin ratio?
3.What is the variable expense ratio?
4.If sales increase to 1,001 units, what would be the increase
in net operating income?
5.If sales decline to 900 units, what would be the net
operating income?
6.If the selling price increases by $2.50 per unit and the
sales volume decreases by 100 units, what would be the net
operating income?
7.If the variable cost per unit increases by $1.50,...
UESTiON 13 A difference between the planned and actual contribution margin (CM) would not be caused by A an increa...
UESTiON 13 A difference between the planned and actual contribution margin (CM) would not be caused by A an increase of decrease in sales volume B. an increase or decrease sales price per unit C. an increase or decrease in fixed costs per unit D any of these would cause a difference between planned and actual CM O E. an increase or decrease in variable cost per unit
ey Formulas 1) Total Contribution Margin = Sales - Variable cost 2) Contribution margin ratio =...
ey Formulas 1) Total Contribution Margin = Sales - Variable cost 2) Contribution margin ratio = Contribution margin / sales 3) Break-even point in units = Fixed cost / unit contribution margir 4) Break-even point in dollars = Fixed cost / contribution margin ra 5) Margin of Safety = Actual Revenue less Breakeven Sales Rever 6) Total Sales = Number of units sold x selling price per unit 7) Total Variable cost = Number of units sold x variable cost...
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Use the following contribution margin statement for 20X9: 20X9 Sales volume (#units) 100 Revenue $7,500 Variable costs $4,500 Contribution margin $3,000 Fixed costs $1,800 Profit $1,200 Required: a) How much is the price per unit, unit variable cost and unit contribution margin? price= unit VC= unit CM= b) Write down the CVP relation: profit as a function of sales volume in units (fill in the missing numbers in an equation like: Profit = 2 *Volume - 50). Profit = *Volume -...
Requirement 1. For each of the following independent situations, calculate the contribution margin per unit and...
Requirement 1. For each of the following independent situations, calculate the contribution margin per unit and the breakeven point in units: Begin by showing the formula for contribution margin per unit and then enter the amounts to calculate the contribution margin per unit for each situation. (Abbreviation used: CM = contribution margin.) CM per unit Situation a. II Situation b. Situation c. Situation d. Now select the labels to show the formula for breakeven point in units and then enter...
Help Save & Exit When a company's Variable Cost Per Unit Increases while all other costs,...
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1. What is the company’s contribution margin (CM) ratio? 2. What is the estimated change in...
1. What is the company’s contribution margin (CM) ratio?
2. What is the estimated change in the company’s net operating
income if it can increase total sales by $1,800? (Do not round
intermediate calculations.)
1-a. The marketing manager argues that a $9,000 increase in
the monthly advertising budget would increase monthly sales by
$20,000. Calculate the increase or decrease in net operating
income.
1-b. Should the advertising budget be increased?
2-a. Refer to the original data. Management is considering
using...
Requirements 1. What is the company's contribution margin per unit? Contribution margin percentage? Total contribution margin? 2. What would the company's monthly operating income be if the company sold 150,000 units? 3. What would the company's monthly operating income be if the company had sales of $4,500,000? 4. What is the breakeven point in units? In sales dollars? 5. How many units would the company have to sell to earn a target monthly profit of $260,400? 6. Management is currently...
Percent of Selling price Variable expenses Contribution margin Per Unit $150 60 $ 90 Sales 1008 40% 60% The company is currently selling 5,200 units per month. Fixed expenses are $208,000 per month. The marketing manager believes that a $6,600 increase in the monthly advertising budget would result in a 150 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change? Multiple Choice decrease of $6,900 decrease of $6,600...
1.What is the contribution margin per unit?
2.What is the contribution margin ratio?
3.What is the variable expense ratio?
4.If sales increase to 1,001 units, what would be the increase
in net operating income?
5.If sales decline to 900 units, what would be the net
operating income?
6.If the selling price increases by $2.50 per unit and the
sales volume decreases by 100 units, what would be the net
operating income?
7.If the variable cost per unit increases by $1.50,...
UESTiON 13 A difference between the planned and actual contribution margin (CM) would not be caused by A an increase of decrease in sales volume B. an increase or decrease sales price per unit C. an increase or decrease in fixed costs per unit D any of these would cause a difference between planned and actual CM O E. an increase or decrease in variable cost per unit
ey Formulas 1) Total Contribution Margin = Sales - Variable cost 2) Contribution margin ratio = Contribution margin / sales 3) Break-even point in units = Fixed cost / unit contribution margir 4) Break-even point in dollars = Fixed cost / contribution margin ra 5) Margin of Safety = Actual Revenue less Breakeven Sales Rever 6) Total Sales = Number of units sold x selling price per unit 7) Total Variable cost = Number of units sold x variable cost...
Requirement 1. For each of the following independent situations, calculate the contribution margin per unit and the breakeven point in units: Begin by showing the formula for contribution margin per unit and then enter the amounts to calculate the contribution margin per unit for each situation. (Abbreviation used: CM = contribution margin.) CM per unit Situation a. II Situation b. Situation c. Situation d. Now select the labels to show the formula for breakeven point in units and then enter...
Help Save & Exit When a company's Variable Cost Per Unit Increases while all other costs, volume, and selling price per unit remain unchanged, what is the impact on the company's contribution margin and net income for this change in variable cost per unit? Multiple Choice Contribution Margin: decrease: Net Income: Increase Contribution Margin: no impact: Net Income: Increase Contribution Margin: Increase: Net Income: decrease Contribution Margin: decrease, Net Income: decrease Contribution Margin: no impact: Net Income decrease A company...
1. What is the company’s contribution margin (CM) ratio?
2. What is the estimated change in the company’s net operating
income if it can increase total sales by $1,800? (Do not round
intermediate calculations.)
1-a. The marketing manager argues that a $9,000 increase in
the monthly advertising budget would increase monthly sales by
$20,000. Calculate the increase or decrease in net operating
income.
1-b. Should the advertising budget be increased?
2-a. Refer to the original data. Management is considering
using...
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