You are provided with the following data.I Unit sales5 Selling price per unit578Variable expenses per unitFixed expensesTarget Profit910 Required:111213 Contribution margin per unit1415 CM ratio16 Variable expense ratio1718 Compute the break-even.1920Break-even in unit sales$Dagatessss is$80,000 units70 per unit28 per unitCompute the CM ratio and variable expense ratio.$ 2,688,000$ 1,610,000

1. CVP analysis is used to identify the changes in costs and volume that affect a company's…

Answered: Contribution margin per unit CM ratio…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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7. Which of the following is a correct formula to calculate contribution margin ratio (CM ratio)? a. Contribution margin/Sales b. Contribution margin/Variable cost c. Contribution margin/Fixed cost d. Sales/Contribution margin
Exercise 3-27 (Algo) Basic Decision Analysis Using CVP (LO 3-1) Belleterre Tiles makes tiles for flooring and other applications. The CFO of the company provides you with the following information for the period October through December, the company's third quarter: Belleterre Tile Revenues and Costs Third Quarter Total quantity sold Total revenues Total variable costs Total fixed costs 126,600 tiles $ 483,612 368,406 109, 200 Required: a. What is the average selling price per tile? Note: Round your final answer to 2 decimal places. b. What is the average variable cost per tile? Note: Round your final answer to 2 decimal places. c. What is the average contribution margin per tile? Note: Do not round intermediate calculations. Round your final answer to 2 decimal places. d. What is the current operating profit for a quarter? Note: Do not round intermediate calculations. e. What is the break-even point? Note: Do not round intermediate calculations. f. The CFO tells you that the company…
The break-even point in dollars is computed by dividing fixed costs by contribution margin ratio. fixed costs by contribution margin per unit. variable costs by contribution margin ratio. O variable costs by contribution margin per unit.
Define the term break-even point. What is the variable cost ratio? The contribution margin ratio? How are the two ratios related? Define the term sales mix. Give an example to support your definition.
Contribution margin dividedt by Income is the: Multiple Choice Contribution margin ratio. Margin of safety. Degree of operating leverage. Sales mix. Break-even point in units.
Sometimes management prefers that the break-even point be expressed in sales dollars rather than units. This can be accomplished by using the contribution margin per unit Select one: O True O False
What can the weighted average contribution margin ratio be used for? Multiple Choice To solve for a measure, at any level of sales volume, of the sensitivity of operating profit to changes in volume. Breakeven and profit planning for sales volume expressed in dollars (Y) rather than units (Q). To calculate an average per-unit contribution margin based on an assumed sales mix. To figure out the relative proportion in which a company’s products (or services) are sold. To determine the extent of fixed costs in an organization’s cost structure.
On the CVP graph, the next unit sold will increase sales by an amount equal to the Select one: O a. Contribution margin ratio O b Selling price per unit minus the variable.costs per unit Oc Variable costs per unit Od. Difference between contribution margin and fixed costs O e. Selling price per unit
Please explain this statement thoroughly. "To estimate what the profit will be at various levels of activity, multiply the number of units to be sold above or below the break-even point by the unit contribution margin."
Sales Variable costs Cost of goods sold Operating expenses Total variable Contribution margin Fixed costs Cost of goods sold Operating expenses Total fixed Net income (loss) Continue LA $ Eliminate LA Net Income Increase (Decrease)
The contribution margin equals sales minus all O period O variable O fixed O product expenses.
Explain how the unit contribution margin can be used todetermine the unit sales required to break even.

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Contribution margin per unit CM ratio Variable expense ratio Compute the break-even. Break-even in unit sales