Answered: Compute the variable cost ratio 2.…

Business

Accounting

Compute the variable cost ratio 2. Compute the contribution ratio 3. Compute the break-even point in units

Financial & Managerial Accounting

14th Edition

ISBN:9781337119207

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter20: Variable Costing For Management Analysis

Section: Chapter Questions

Problem 20.10EX

See similar textbooks

Related questions

Q: The amount of revenue required to earn a target profit is equal to Total fixed cost divided by…

A: The break even sales are the sales where business earns no profit no loss.

Q: Fill in the missing amounts in each of the eight case situations below. Each case is independent of…

Q: Which one of the following is not considered an assumption of cost-volume-profit analysis? a. Sales…

A: Cost volume profit analysis enables the management in determining the relation of costs and revenues…

Q: 2. Determine the missing amounts. Contribution Margin Contribution Margin per Unit Unit Selling…

A: The missing figures in the above table.

Q: (1)Use the graph to answer the question that follows. Based on the chart above, if the product…

A: Marginal revenue is referred as the revenue, which usually leads from the sale of an one additional…

Q: Fill in the missing amounts in each of the eight case situations below. Each case is independent of…

A: The contribution margin is calculated as the difference between the sales and variable costs. The…

Q: All else being equal, what happens to the unit contribution margin and the contribution margin ratio…

A: Contribution margin is the margin of profits of any enterprise which is essentially a function of…

Q: The ratio of contribution margin in dollars to the selling price is the: Select one: Oprofit margin.…

A: We know that, Contribution is sales - variable cost

Q: a. What is the company's break-even point in unit sales? Break even point units b. Is it above or…

A: Break even sales is the sales level at which an entity is able to recover all its costs that is the…

Q: Exercise 3-27 (Algo) Basic Decision Analysis Using CVP (LO 3-1) Belleterre Tiles makes tiles for…

A: Average Selling Price: The price at which each tile is sold on average.Average Variable Cost: The…

Q: Given that the total cost, C, is related to sales volume, x, by the equation y=1000+0.2x, say true…

A: a) The cost-sales line rises $2 for each increase of $10 in sales volume. So putting the above value…

Q: Which of the following equations is correct for determining the required sales in units to generate…

A: Pretax income, also known as earnings before tax or pretax earnings, is the net income earned by a…

Q: The equation for total costs (Y) is: Y = a+ bX In this equation, “a” represents: Net income…

A: Total cost equation represent two type of cost which includes total variable cost and total fixed…

Concept explainers

Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.

Question

1. Compute the variable cost ratio

2. Compute the contribution ratio

3. Compute the break-even point in units

4. Compute the break-even sales in pesos

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Whirly has the following information for 2015. They sell Flying Carpets. Sales Contribution Margin Net Income 1. Complete a table for Whirly. Total $400,000 $150,000 $15,000 CVP and BEP Quantity 10,000 Flying Carpets Per Unit Ratio To Sales
The ratio of contribution margin in dollars to the selling price is the: Select one: O profit margin. O break-even point in unit sales. O contribution margin ratio. O net income
Which of the following formulas is used to calculate the contribution margin ratio?(Sales − Fixed costs) ÷ Sales.(Sales − Total costs) ÷ Sales.(Sales − Cost of goods sold) ÷ Sales.(Sales − Variable costs) ÷ Sales.
What is the contribution margin per unit? contribution margin ratio? Unit sales at break even point? Dollar sales at break even point? Expected net income?
What ratio indicates the percentage of each sales dollar that is available to cover fixed costs and to provide a profit? A. Margin of safety ratioB. Contribution margin ratioC. Costs and expenses ratioD. Profit ratio
In the month of March, Blossom Salon services 620 clients at an average price of $120. During the month, fixed costs were $18,564 and variable costs were 65% of sales. (a) Your answer is correct. Determine the total contribution margin in dollars, the per unit contribution margin, and the contribution margin ratio. Contribution margin in dollars Contribution margin per unit Contribution margin ratio $ 26040 42 35
21. The peso amount of sales needed to attain a desired profit is calculated by dividing the CM ratio into a. desired profit b. desired profit plus fixed cost c. desired profit less fixed cost d. fixed cost
Wildhorse sells a learning system that helps preschool and elementary students learn basic math facts and concepts. The company income statement from last month is as follows: Total Per Unit Sales revenue $700,000 $50 Variable expenses 315,000 22.50 Contribution margin 385,000 $27.50 Fixed expenses 264,000 Operating income $ 121,000
Which of the following ratios indicates the percentage of each sales dollar that is available to cover fixed costs and to provide a profit? a. costs and expenses ratio b. contribution margin ratio c. margin of safety ratio d. profit ratio
Given the following notations, what is the breakeven sales level in units? SP =selling price per unit FC = total fixed cost VC = variable cost per unit A. SP / (FC/VC)B. FC/(VC/SP)C. VC/(SP – FC)D. FC/(SP – VC)
Given the mixed cost function y = $6.50x + $3,000. What does the $6.50 represent? a.Total cost per unit of the cost driver b.The fixed cost per unit c.The slope of the cost function d.Total fixed costs
True or False. Variable costs as a percentage of sales are equal to 100% minus the contribution margin ratio.