Question

The section of Waterways that produces controllers for the company provided the following information.

Sales in units for month of February		3,800
Variable manufacturing cost per unit		$10.00
Sales price per unit		$45.00
Fixed manufacturing overhead cost (per month for controllers)		$82,000
Variable selling and administrative expenses per unit		$3.50
Fixed selling and administrative expenses (per month for controllers)		$14,320

Using this information for the controllers, determine the contribution margin ratio, the degree of operating leverage, the break-even point in dollars, and the margin of safety ratio for Waterways Corporation on this product.

Contribution Margin Ratio (Round to 0 decimal places, e.g. 25%.)			%
Degree of Operating Leverage (Round to 2 decimal places, e.g. 5.25.)
Break-even Point in Dollars		$
Margin of Safety Ratio (Round to 1 decimal place, e.g. 5.2%.)			%

Answer 1