Homework Answers
Solution : 5
Contribution Margin: Sales -Variable manufacturing cost - Variable selling and administrative cost
Contribution Margin: $ 274,000 - $ 93,000 - $ 38,000
Contribution Margin: $ 143,000
Hence, Company's contribution margin : $ 143,000
Solution: 6
Contribution Margin: Sales Revenue - Cost of goods sold Variable - Supplies
Contribution Margin: $ 32,640 - $ 15,640 - $ 2,040
Contribution Margin: $ 14,960
Net Income (Given) : $ 2,360
We know that:
Magnitude of operating leverage: Contribution Margin / Net Income
Magnitude of operating leverage: $ 14,960 / $ 2,360
Magnitude of operating leverage: 6.34
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Fixed Manufacturing overhead Fixed Selling and administrative expense sales Units in Beginning inventory Units produced Units...
Fixed Manufacturing overhead
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sales
Units in Beginning inventory
Units produced
Units Sold
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variable selling and administrative expense
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Fixed Manufacturing overhead
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sales
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variable selling and administrative expense
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