Bags Unlimited manufactures and markets backpacks for the youth market. Financial projections for this line of products are revenues of $1,238,000, total variable costs of $841,840 and fixed costs of $218,000. Answer each of the following independent questions. a. Compute the contribution margin. ______________________ b. Compute the contribution rate. ______________________________ c. How much of this product line does the business need to sell to break even? ___________ d. If the business was to save $56,000 in variable costs by offering fewer colors of backpacks, how much of this product line does the business need to sell to break even?
Unitary Method
The word “unitary” comes from the word “unit”, which means a single and complete entity. In this method, we find the value of a unit product from the given number of products, and then we solve for the other number of products.
Speed, Time, and Distance
Imagine you and 3 of your friends are planning to go to the playground at 6 in the evening. Your house is one mile away from the playground and one of your friends named Jim must start at 5 pm to reach the playground by walk. The other two friends are 3 miles away.
Profit and Loss
The amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item.
Units and Measurements
Measurements and comparisons are the foundation of science and engineering. We, therefore, need rules that tell us how things are measured and compared. For these measurements and comparisons, we perform certain experiments, and we will need the experiments to set up the devices.
Bags Unlimited manufactures and markets backpacks for the youth market. Financial projections for this line of products are revenues of $1,238,000, total variable costs of $841,840 and fixed costs of $218,000. Answer each of the following independent questions.
a. Compute the contribution margin. ______________________
b. Compute the contribution rate. ______________________________
c. How much of this product line does the business need to sell to break even? ___________
d. If the business was to save $56,000 in variable costs by offering fewer colors of backpacks, how much of this product line does the business need to sell to break even?
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