Disc Buddy, Inc. produces flash drives. The selling price is $8 per drive. The variable cost of production is $2.40 per unit and the fixed cost per month is $3,600. a. Calculate the contribution margin associated with each flash drive. b. In August, the company sold 200 more flash drives than planned. What is the expected effect on profit of selling the additional drives? c. Calculate the contribution margin ratio associated with one flash drive. d. In October, the company had sales that were $2,400 higher than planned.

Disc Buddy, Inc. produces flash drives. The selling price is $8 per drive. The variable cost of production is $2.40 per unit and the fixed cost per month is $3,600. a. Calculate the contribution margin associated with each flash drive. b. In August, the company sold 200 more flash drives than planned. What is the expected effect on profit of selling the additional drives? c. Calculate the contribution margin ratio associated with one flash drive. d. In October, the company had sales that were $2,400 higher than planned.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 10E: Schylar Pharmaceuticals, Inc., plans to sell 130,000 units of antibiotic at an average price of 22...

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