Question

Flannigan Company manufactures and sells a single product that sells for $550 per unit; variable costs are $297. Annual fixed
0 0
Add a comment Improve this question Transcribed image text
Answer #1
CALCULATION OF CONTRIBUTION MARGIN
PARTICULARS AMOUNT
Selling Price Per Unit= $                         550
Less: Variable Cost Per Unit $                         297
Contribution Margin Per Unit $                         253
CALCULATION OF THE BREAK EVEN POINT OF SALES
Break Even point =      Fixed Cost / Contribution Margin Per Unit
Break Even point =      
Fixed Cost = $               9,66,000
Divide By "/" By
Contribution Margin Per Unit = $                         253
Break Even point =                               3,818 Units
So Break Even Sales = 3,818 Unit X $ 550 =                 21,00,000
Margin of Safety = Current Sales Level - Break Even Sales
Margin of Safety = $ 4,300,000 - $ 2,100,000
Margin of Safety = $ 2,200,000
So, Answer = Option 2 = $ 2,200,000 / -
Add a comment
Know the answer?
Add Answer to:
Flannigan Company manufactures and sells a single product that sells for $550 per unit; variable costs...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT