Question

Cover-to-Cover Company

Contribution Margin Income Statement

For the Year Ended December 31

1	Sales			$424,000.00
2	Variable costs:
3	Manufacturing		$233,200.00
4	Selling		21,200.00
5	Administrative		63,600.00	318,000.00
6	Contribution margin			$106,000.00
7	Fixed costs:
8	Manufacturing		$5,000.00
9	Selling		4,000.00
10	Administrative		33,400.00	42,400.00
11	Income from operations			$63,600.00 Review the contribution margin The excess of sales over variable costs. income statements for Cover-to-Cover Company and Biblio Files Company on their respective Income Statements panels. Complete the following table from the data provided in the income statements. Each company sold 84,800 units during the year. Cover-to-Cover Company Biblio Files Company Contribution margin ratio The percentage of each sales dollar that is available to cover the fixed costs and provide an operating income. (percent) Unit contribution margin The dollars available from each unit of sales to cover fixed costs and provide operating profits. Break-even sales (units) Break-even sales (dollars) Biblio Files Company Contribution Margin Income Statement For the Year Ended December 31 1 Sales $424,000.00 2 Variable costs: 3 Manufacturing $169,600.00 4 Selling 16,960.00 5 Administrative 67,840.00 254,400.00 6 Contribution margin $169,600.00 7 Fixed costs: 8 Manufacturing $88,000.00 9 Selling 8,000.00 10 Administrative 10,000.00 106,000.00 11 Income from operations $63,600.00

Answer 1