Homework Answers
Units sold:
= $1,950,000 / $0.50
= 3,900,000
Variable cost per unit:
= $1,365,000 / 3,900,000
= $0.35
Contribution margin per unit:
= $0.50 - $0.35
= $0.15
Contribution margin ratio:
= $0.15 / $0.50
= 30%
1)
Breakeven point in units:
= $380,250 / $0.15
= 2,525,000
2)
Breakeven point in dollars:
= $380,250 / 30%
= $1,267,500
Contribution margin ratio = 30% (Calculated above)
Margin of safety ratio:
= ($1,950,000 - $1,267,500) / $1,950,000
= 35%
Required sales dollars:
= ($380,250 + $210,000) / 30%
= $1,967,500
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Selling expenses—variable
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Direct materials
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Selling expenses—fixed
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Direct labor
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Administrative expenses—variable
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Sunland 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 75 cents per bottle. For the year
2020, management estimates the following revenues and
costs.
Sales
$1,920,000
Selling expenses—variable
$147,000
Direct materials
410,000
Selling expenses—fixed
52,000
Direct labor
370,000
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Blossom Company bottles and distributes B-Lite, a diet soft
drink. The beverage is sold for 50 cents per 16-ounce bottle to
retailers, who charge customers 75 cents per bottle. For the year
2020, management estimates the following revenues and costs.
Sales
$1,500,000
Selling expenses—variable
$90,000
Direct materials
410,000
Selling expenses—fixed
50,000
Direct labor
330,000
Administrative expenses—variable
20,000
Manufacturing overhead—variable
350,000
Administrative expenses—fixed
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Manufacturing overhead—fixed
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Please correct the
wrong answers.
Problem 5-3A (Video) Blossom Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 50 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2020, management estimates the following revenues and costs. Sales $1,500,000 Selling expenses,variable $90,000 Direct materials 410,000 Selling expenses-fixed 50,000 Direct labor 330,000 Administrative expenses-variable 20,000 Manufacturing overhead-variable 350,000 Administrative expenses-fixed 40,000 Manufacturing overhead-fixed 150,000 Your answer is correct. Prepare a...
Jorge Company bottles and distributes B-Lite, a diet soft
drink. The beverage is sold for 50 cents per 16-ounce bottle to
retailers, who charge customers 78 cents per bottle. For the year
2014, management estimates the following revenues and costs.
Sales
$1,804,000
Selling expenses—variable
$69,800
Direct materials
428,000
Selling expenses—fixed
65,800
Direct labor
354,000
Administrative expenses—variable
64,920
Manufacturing overhead—variable
310,000
Administrative expenses—fixed
64,900
Manufacturing overhead—fixed
288,000
Prepare a CVP income statement for 2014 based on management’s
estimates.
$
Calculate variable...
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