Question

Culver Company has the following information available for September 2017.

Unit selling price of video game consoles		$476
Unit variable costs		$333
Total fixed costs		$64,350
Units sold		714 a.)Compute the unit contribution margin. b.)Prepare a CVP income statement that shows both total and per unit amounts. c.)Compute Billing's break even points in units. d.)Prepare a CVP income statement for the break even point that shows both total and per unit amounts.

Answer 1

Part -(a)	Contribution margin = (Unit sales - Variable cost) = (476-333) = $143
Part -(b)	CVP Income statement
		Per unit	Total
	Sales	476	339,864
	Variable cost	333	237,762
	Contribution margin	143	102,102
	Fixed cost		64,350
	Net operating income		37,752
Part -(c)	Break even point = (Fixed cost / Contribution per unit) = (64,350/143) = 450
Part -(d)	CVP Income statement
		Per unit	Total
	Sales	476	214,200
	Variable cost	333	149,850
	Contribution margin	143	64,350
	Fixed cost		64,350
	Net operating income		-