What is contribution margin equal to on a contribution margin income statement? A. Sales revenues minus...
What is contribution margin equal to on a contribution margin income statement?
A.
Sales revenues minus fixed expenses
B.
Fixed expenses plus variable expenses
C.
Sales revenues minus variable expenses
D.
Fixed expenses minus variable expenses
Homework Answers
C. Sales revenues minus variable expenses
Contribution margin on a contribution margin income statement is equal to sales revenues minus variable expenses. It represents the amount of money available to cover fixed expenses and contribute to profits after deducting all variable costs associated with the production or sale of goods or services. It is an important metric for analyzing the profitability of individual products or services and making decisions about pricing and cost management.
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What is contribution margin equal to on a contribution margin
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A.
Sales revenues minus...
P18-2A Prepare a CVP income statement, compute break-even point, contribution margin ratio, margin of safety ratio...
P18-2A Prepare a CVP income statement, compute break-even point, contribution margin ratio, margin of safety ratio and sales for target net income 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 75 cents per bottle. For the year 2017, management estimates the following revenues and costs. Sales $1,800,000 Selling expenses - variable Direct materials 430,000 Selling expenses - fixed Direct labor 360,000 Administrative...
Universal Travel uses the contribution margin income statement internally. Universal's first quarter results are as follows:...
Universal Travel uses the contribution margin income statement internally. Universal's first quarter results are as follows: LOADING...(Click the icon to view the income statement.) Universal's relevant range is sales of between $ 105 comma 000 and $ 650 comma 000. Read the requirementsLOADING.... Requirement 1. Prepare contribution margin income statements at sales levels of $ 180 comma 000 and $ 420 comma 000. (Hint: Use the contribution margin ratio.) Begin by preparing the contribution margin income statement at the $...
Zeta Corp's most recent income statement is given below. Sales (8,000 units) Less variable expenses Contribution...
Zeta Corp's most recent income statement is given below. Sales (8,000 units) Less variable expenses Contribution margin Less fixed expenses Net income $160,000 (68,000) 92,000 (50,000) $ 42,000 Required: a. Contribution margin % per unit is b. If sales are doubled to $240,000, total variable costs will equal C. If sales are doubled to $240,000, total fixed costs will equal d. If 20 more units are sold, profits will increase to
CountrywideCountrywide Travel uses the contribution margin income statement internally. Countrywide'sCountrywide's first quarter results are as follows:...
CountrywideCountrywide Travel uses the contribution margin income statement internally. Countrywide'sCountrywide's first quarter results are as follows: LOADING... (Click the icon to view the income statement.) Countrywide'sCountrywide's relevant range is sales of between $ 140 comma 000$140,000 and $ 640 comma 000$640,000. Read the requirements LOADING... . Requirement 1. Prepare contribution margin income statements at sales levels of $ 210 comma 000$210,000 and $ 390 comma 000$390,000. (Hint: Use the contribution margin ratio.)Begin by preparing the contribution margin income statement at...
Given the following contribution income statement, how much contribution margin must this company have in order...
Given the following contribution income statement, how much contribution margin must this company have in order to cover its fixed costs (i.e. break even)? Total Unit Sales Revenue ( 1,000 units) $100,000 $100 Variable Expenses 60,000 60 Contribution Margin $ 40,000 $ 40 Fixed Expenses 36,000 Operating Income $ 4,000 a. $44,000 O b. $36,000 c. $4,000 d. $76,000 e. $40,000
Serfass Corporation's contribution format income statement for July appears below: Sales Variable expenses Contribution margin Fixed...
Serfass Corporation's contribution format income statement for July appears below: Sales Variable expenses Contribution margin Fixed expenses Net operating income $369,000 147,600 221,400 55,350 $166,050 The degree of operating leverage is closest to: Newham Corporation produces and sells two products. In the most recent month, Product R10L had sales of $31,000 and variable expenses of $10,780. Product X96N had sales of $44,000 and variable expenses of $18,470. The fixed expenses of the entire company were $46,060. The break-even point for...
Hudson Co. reports the contribution margin income statement for 2017 HUDSON CO. Contribution Margin Income Statement...
Hudson Co. reports the contribution margin income statement for 2017 HUDSON CO. Contribution Margin Income Statement For Year Ended December 31, 2017 Sales (11,200 units at $280 each) Variable costs (11,200 units at $210 each) Contribution margin Fixed cost Pretax income $3,136,000 2,352,000 $784,000 567.000 $ 217,000 Exercise 18-18 Evaluating strategies LO C2 Assume the company is considering investing in a new machine that will increase its fixed costs by $37,500 per year and decrease its variable costs by $10...
Hudson Co. reports the contribution margin income statement for 2019. HUDSON CO. Contribution Margin Income Statement...
Hudson Co. reports the contribution margin income statement for 2019. HUDSON CO. Contribution Margin Income Statement For Year Ended December 31, 2019 Sales (12,000 units at $225 each) $ 2,700,000 Variable costs (12,000 units at $180 each) 2,160,000 Contribution margin $ 540,000 Fixed costs 360,000 Pretax income $ 180,000 1. Compute the company’s degree of operating leverage for 2019. 2. If sales decrease by 4% in 2020, what will be the company’s pretax income? 3. Assume sales for 2020 decrease...
Serfass Corporation's contribution format income statement for July appears below. Sales Variable expenses Contribution margin Fixed...
Serfass Corporation's contribution format income statement for July appears below. Sales Variable expenses Contribution margin Fixed expenses Net operating income $327,700 180,235 147,465 66,360 $ 81,105 The degree of operating leverage is closest to Multiple Choice
c) Hanna's income statement is as follows: Sales (10,000 units) Less variable costs Contribution margin Less...
c) Hanna's income statement is as follows: Sales (10,000 units) Less variable costs Contribution margin Less fixed costs Net income $175,000 - 68,000 $107.000 - 36.000 $ 71.000 If sales decrease by $35,000, profits will (Points 2.0): d) Hanna's income statement is as follows: Sales (10,000 units) Less variable costs Contribution margin Less fixed costs Net income $117,000 - 68,000 $49,000 - 36.000 $ 13,000 What is the break-even point in units and in sales dollars? (Points 1.0): e) Using...
Zeta Corp's most recent income statement is given below. Sales (8,000 units) Less variable expenses Contribution margin Less fixed expenses Net income $160,000 (68,000) 92,000 (50,000) $ 42,000 Required: a. Contribution margin % per unit is b. If sales are doubled to $240,000, total variable costs will equal C. If sales are doubled to $240,000, total fixed costs will equal d. If 20 more units are sold, profits will increase to
Given the following contribution income statement, how much contribution margin must this company have in order to cover its fixed costs (i.e. break even)? Total Unit Sales Revenue ( 1,000 units) $100,000 $100 Variable Expenses 60,000 60 Contribution Margin $ 40,000 $ 40 Fixed Expenses 36,000 Operating Income $ 4,000 a. $44,000 O b. $36,000 c. $4,000 d. $76,000 e. $40,000
Serfass Corporation's contribution format income statement for July appears below: Sales Variable expenses Contribution margin Fixed expenses Net operating income $369,000 147,600 221,400 55,350 $166,050 The degree of operating leverage is closest to: Newham Corporation produces and sells two products. In the most recent month, Product R10L had sales of $31,000 and variable expenses of $10,780. Product X96N had sales of $44,000 and variable expenses of $18,470. The fixed expenses of the entire company were $46,060. The break-even point for...
Hudson Co. reports the contribution margin income statement for 2017 HUDSON CO. Contribution Margin Income Statement For Year Ended December 31, 2017 Sales (11,200 units at $280 each) Variable costs (11,200 units at $210 each) Contribution margin Fixed cost Pretax income $3,136,000 2,352,000 $784,000 567.000 $ 217,000 Exercise 18-18 Evaluating strategies LO C2 Assume the company is considering investing in a new machine that will increase its fixed costs by $37,500 per year and decrease its variable costs by $10...
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c) Hanna's income statement is as follows: Sales (10,000 units) Less variable costs Contribution margin Less fixed costs Net income $175,000 - 68,000 $107.000 - 36.000 $ 71.000 If sales decrease by $35,000, profits will (Points 2.0): d) Hanna's income statement is as follows: Sales (10,000 units) Less variable costs Contribution margin Less fixed costs Net income $117,000 - 68,000 $49,000 - 36.000 $ 13,000 What is the break-even point in units and in sales dollars? (Points 1.0): e) Using...
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