Homework Answers
Margin of Safety in Dollars = (Total Sales Units – Break even units)*Selling price per unit
= (5000-2800)*10
= $22,000
16.Net Income = Sales Revenue*Contribution Margin Ratio – Fixed costs
= 500,000*20% - 80,000
= $20,000 Net Income
15.Total Contribution Margin = Total Sales*Contribution Margin Ratio
= 675,000*60%
= $405,000
14.Margin of safety ratio = (Sales – break even sales)/Sales
= (450,000-299,000)/450,000
= 33.56%
i.e. 35.55% approx.
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Question 17 1 pts Baylee Company expected to sell 5000 units. Their break-even is 2800 units. If their selling price is...
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Break-Even Point in Units
Chillmax Company plans to sell 3,500 pairs of shoes at $60
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and administrative expense).
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1. Calculate the sales revenue that Chillmax must make to
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Z Instructions Question 17 1 pts Baylee Company expected to sell 5000 units. Their break-even is 2800 units. If their selling price is $10 per unit, what is their margin of safety in dollars? o $22,000 $50,000 • $78,000 o $28,000
ve expected sales. O Expected sales over break-even sales Question 11 2.5 pts During March, a firm expects its total sales to be $160,000, its total variable costs to be $95.000, and its total fixed costs to be $25,000. The contribution margin for March is: O $65,000. O $90,000 $120,000 O $40,000 $25,000 2.5 pts Question 12 Watson Company has monthly fixed costs of $83,000 and a 40% contribution margin ratio. If the company has set a target monthly income...
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Break-Even Point in Units
Chillmax Company plans to sell 3,500 pairs of shoes at $60
each in the coming year. Variable cost is 35% of the sales price;
contribution margin is 65% of the sales price. Total fixed cost
equals $78,000 (includes fixed factory overhead and fixed selling
and administrative expense).
Required:
1. Calculate the sales revenue that Chillmax must make to
break even by using the break-even point in sales equation. $
2. Prepare a contribution margin income statement...
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