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Cost-Volume-Profit Relations: Missing Data Following are data from 4 separate companies. Supply the missing data in...

Cost-Volume-Profit Relations: Missing Data
Following are data from 4 separate companies. Supply the missing data in each independent case

Case A Case B Case C Case D
Unit Sales 1,000 800 Answer Answer
Sales revenue $20,000 Answer Answer $60,000
Variable cost per unit $10 $2 $10 Answer
Contribution margin Answer $800 Answer Answer
Fixed Costs $8,100 Answer $60,000 Answer
Net income Answer $600 Answer Answer
Unit contribution margin Answer Answer Answer $13
Break-even point (units) Answer Answer 4,000 2,000
Margin of safety (units) Answer Answer 100 1,000

Solutions

Expert Solution

Ans: For Case A

A). Contribution Margin= Selling Price- Variable Cost

=> 20,000-{1000*10}

=> 10,000

B). Net Income= Contribution margin- Fixed Costs

=> 10,000-8,100

=> 1,900

C). Unit Contribution Margin= Contribution Margin/ No of Units Sold
=> 10,000/1,000

=> $10

D). break-even Units= Fixed Cost/ Contribution Margin Per unit

=> 8,100/10

=>810 Units

E). Margin of Safety{Units}= Budgeted Units- Break-even Units

=> 1,000-810

=> 190 Units

For Case B

F). Contribution Margin= Sales- Variable costs

800=Sales-1,600

Sales= 2,400

G). Net income= Contribution Margin- Fixed Costs

=> 600= 800-Fixed costs

=> Fixed Costs= 200

H). Unit Contribution Margin= Contribution Margin/ No of Units

=> 800/800

=> 1 Per unit

I). Break-even Point in Units= Fixed Cost/ Contribution Margin Per unit

=> 200/1

=> 200

J). Margin of Safety= Budgeted Units- Break-even Units

=> 800-200

=> 600


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