Case 1 Case 2 Case 3 Case 4 Sales Revenue 100,000 100,000 answer? answer? Contribution Margin...

	Case 1	Case 2	Case 3	Case 4
Sales Revenue	100,000	100,000	answer?	answer?
Contribution Margin	40,000	answer?	20,000	answer?
Fixed cost	20,000	anwser?	answer?	answer?
Net Income	answer?	5,000	9,000	answer?
Variable Cost Ratio	answer?	answer?	answer?	.20
Contribution Margin Ratio	answer?	answer?	.50	answer?
Break even point (dollars)	answer?	answer?	answer?	25,000
Margin of safety (dollars)	answer?	answer?	answer?	20,000

Expert Solution

ekkarill92 answered 2 years ago

Contribution Margin Analysis: We calculate contribution margin by taking our sales revenue less our variable costs....

Contribution Margin Analysis: We calculate contribution margin by taking our sales revenue less our variable costs. This basically tells us the portion of our sales that are available to cover the fixed cost of the business. Contribution margin per unit is especially useful. We compute this by taking our sales revenues per unit less our variable cost per unit. With this, we can easily compute our break-even point. Dog Day Care Pricing at $18 per dog per day, you can...

Contribution margin is: A. the excess of sales revenue over variable cost B. another...

Contribution margin is: A. the excess of sales revenue over variable cost B. another term for volume in the "cost-volume-profit" analysis C. profit D. the same as sales revenue Salim’s fixed costs are RM41, 500, the variable cost is RM12 per unit. If Salim sells the product for RM22 per unit, the breakeven point is: A. 4,150 units B. 8,300 units C. 2,075 units D. 6,225 units The fixed costs of Juara...

Break-Even in Sales Revenue, Variable-Costing Ratio, Contribution Margin Ratio, Margin of Safety Hammond Company runs a...

Break-Even in Sales Revenue, Variable-Costing Ratio, Contribution Margin Ratio, Margin of Safety Hammond Company runs a driving range and golf shop. The budgeted income statement for the coming year is as follows. Sales $1,240,000 Less: Variable expenses 706,800 Contribution margin $533,200 Less: Fixed expenses 425,000 Income before taxes $108,200 Less: Income taxes 43,280 Net income $64,920 Required: 1. What is Hammond’s variable cost ratio? Enter your answer as a decimal value rounded to two decimal places. What is the contribution...

Question 1: CVP relation Sales volume in units 100 Revenue $7,000 Variable costs $4,000 Contribution margin...

Question 1: CVP relation Sales volume in units 100 Revenue $7,000 Variable costs $4,000 Contribution margin $3,000 Fixed costs $1,800 Profit $1,200 a) Compute the following items: price= unit VC= unit CM= b) Write down the CVP relation. Profit = ___________ * volume - __________ (e.g., if Profit=4*volume-1000, enter 4 in the first box and 1000 in the second box). c) Predict profit at sales volume of 120 units: d) Your boss gave you a profit target...

What is (a) the contribution margin ratio and (b) the unit contribution margin? 2. Determine the break-even point in units. 3.What is the margin of safety?

Wyatt Inc. expects to maintain the same inventories at the end of the year as at the beginning of the year. The estimated fixed costs for the year are $288,000, and the estimated variable costs per unit are $14. It is expected that 60,000 units will be sold at a price of $20 per unit. Maximum sales within the relevant range are 70,000 units.1. What is (a) the contribution margin ratio and (b) the unit contribution margin?2. Determine the break-even...

True and false questions 1. Contribution margin plus variable cost will equal revenue? 2. Capital budgets...

True and false questions 1. Contribution margin plus variable cost will equal revenue? 2. Capital budgets are used for the budgeting of large expensive expenditures? 3. Ending inventory in a purchases budget is based on next months forecasted sales? 4. Only manufacturing companies can use job order cost accounting? 5. Unfavorable and favorable variances are both investigated? 6. Break-even is the point at which a company achieves its target profit? 7. Contribution margin and gross margin are the same thing?...

If total fixed costs is $100,000, contribution per unit is $25 and the contribution margin ratio...

If total fixed costs is $100,000, contribution per unit is $25 and the contribution margin ratio is 40% and the company desired target profit of $25,000, what are the values of the followings (see page 97): a) Break-Even-Point in unit = _________________? b) Break-Even-Point in sales dollars________________________?

The contribution margin income statement of Krazy Kustard Donuts for August 2016 Sales Revenue: $125,000 Variable...

The contribution margin income statement of Krazy Kustard Donuts for August 2016 Sales Revenue: $125,000 Variable Costs: COGS: $32,100, Selling Costs: $17,100, Administrative Costs: $800 Contribution Margin: $75,000 Fixed Costs: Selling Costs: $32,400, Administrative Costs: $10,800 Operating Income: $31,800 Krazy Kustard sells 4 dozen plain donuts for every dozen custard-filled donuts. A dozen plain donuts sells for $4.00, with total variable cost of $1.60 per dozen. A dozen custard-filled donuts sells for $8.00, with total variable cost of $ $3.20...

4. The contribution margin ratio for Zee Corporation is 40%, sales are $600,000, and fixed costs...

4. The contribution margin ratio for Zee Corporation is 40%, sales are $600,000, and fixed costs are $160,000. An increase in a. 10%Zee’s sales by 10% will increase the corporation’s profitability by: a. 10% b. 20% c. 30% d. 40% e. Cannot be determined with the above provided information.

1.What is a contribution margin and how is it different from gross margin? 2.What is the...

1.What is a contribution margin and how is it different from gross margin? 2.What is the significance of the contribution margin ratio, and how is the ratio useful in planning business operations? 3.Explain what is meant by the margin of safety? 4.What does the margin of safety tell companies and how can they use this information?

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