9. The Alpine House is a large manufacturer and retailer of snow skis. The company sold all the products it produced during the period. The company provided the information below. Total sales revenue $500,000 Selling price per pair of skis $500 Variable selling expense per pair of skis $50 Variable admin expense per pair of skis $10 Total Fixed selling expenses $20,000 Total fixed administrative expenses $20,000 Cost of Goods Sold: Direct Materials $40,000 Direct Labor $100,000 Manufacturing Overhead $70,000 Included in Manufacturing Overhead is the following: Rent (Contract at $1,000 per month) $12,000 Salary to Factory Supervisor $50,000 Indirect Materials (Driven on units produced) $8,000 Required; 3. Calculate the contribution margin and variable expense ratios. 4. Compute the operating leverage.

FINANCIAL ACCOUNTING
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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9. The Alpine House is a large manufacturer and retailer of
snow skis. The company sold all the products it produced
during the period. The company provided the information
below.
Total sales revenue $500,000
Selling price per pair of skis $500
Variable selling expense per pair of skis $50
Variable admin expense per pair of skis $10
Total Fixed selling expenses $20,000
Total fixed administrative expenses $20,000
Cost of Goods Sold:
Direct Materials $40,000
Direct Labor $100,000
Manufacturing Overhead $70,000
Included in Manufacturing Overhead is the following:
Rent (Contract at $1,000 per month) $12,000
Salary to Factory Supervisor $50,000
Indirect Materials (Driven on units produced) $8,000
Required;
3. Calculate the contribution margin and variable expense
ratios.
4. Compute the operating leverage.
Transcribed Image Text:9. The Alpine House is a large manufacturer and retailer of snow skis. The company sold all the products it produced during the period. The company provided the information below. Total sales revenue $500,000 Selling price per pair of skis $500 Variable selling expense per pair of skis $50 Variable admin expense per pair of skis $10 Total Fixed selling expenses $20,000 Total fixed administrative expenses $20,000 Cost of Goods Sold: Direct Materials $40,000 Direct Labor $100,000 Manufacturing Overhead $70,000 Included in Manufacturing Overhead is the following: Rent (Contract at $1,000 per month) $12,000 Salary to Factory Supervisor $50,000 Indirect Materials (Driven on units produced) $8,000 Required; 3. Calculate the contribution margin and variable expense ratios. 4. Compute the operating leverage.
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