Question

1. Cross-number problem (fill in the missing amounts in the cases below, each case is independent)

Case	Units Sold	Sales	Variable Expenses	Contribution Margin per unit	Fixed Expenses	Net Income
1	?	$100,000	?	10	32,000	8,000
2	6,000	300,000	?	?	100,000	(10,000)

Case	Sales	Variable expenses	Average contribution margin (percent)	Fixed expenses	Net Income (loss)
3	$500,000	?	20	?	$7,000
4.	?	?	60	130,000	20,000

Answer 1

Based on the information available in the question, we can answer as follows:-

Case 1 :-

Net Income + Fixed expense = Contribution Margin

Contribution Margin = $8,000 + $32,000

Contribution Margin = $40,000

Contribution Margin per unit = $10

No.of units sold = $40,000/$10

No.of units sold = 4,000 units

Contribution margin = Sales - Variable expenses

Let variable expenses be "x"-

$40,000 = $100,000 - X

Variable expenses = $60,000

Case 2:-

Net Income + Fixed expense = Contribution Margin

Contribution Margin = ($10,000) + $100,000

Contribution Margin = $90,000

Contribution margin per unit = $90,000/6,000 units sold

Contribution margin per unit = $15 per unit

Contribution Margin = Sales - Variable expenses

Let variable expenses be "x"

$90,000 = $300,000 - X

X = $300,000 - $90,000

X = $210,000

Variable expenses = $210,000

Case 3:-

Contribution Margin (in dollars) = Sales/Contribution margin %

Contribution Margin (in dollars) = $500,000 * 20%

Contribution Margin (in dollars) = $100,000

Variable expenses = Sales - Contribution Margin

Variable expenses = $500,000 - $100,000

Variable expenses = $400,000

Fixed expenses = Contribution Margin - Net Income

Fixed expenses = $100,000 - $7,000

Fixed expenses = $93,000

Case 4:-

Contribution Margin = Fixed expenses + Net Income

Contribution Margin = $130,000 + $20,000

Contribution Margin = $150,000

Sales = Contribution Margin/Contribution Margin %

Sales = $150,000/60%

Sales = $250,000

Since contribution margin is 60% of sales, variable expenses will be 40% of sales

Variable expenses = $250,000 * 40%

Variable expenses = $100,000

Please let me know if you have any questions via comments and all the best :) !