erritory and Product Profitability Analysis Coast to Coast Surfboards Inc. manufactures and sells two styles of surfboards, Atlantic Wave and Pacific Pounder. These surfboards are sold in two regions, East Coast and West Coast. Information about the two surfboards is as follows: Atlantic Wave Pacific Pounder Sales price $400 $350 Variable cost of goods sold per unit (148) (161) Manufacturing margin per unit $252 $189 Variable selling expense per unit (156) (91) Contribution margin per unit $96 $98 The sales unit volume for the territories and products for the period is as follows: East Coast West Coast Atlantic Wave 3,260 1,630 Pacific Pounder 0 1,630 Question Content Area a. Prepare a contribution margin by sales territory report. Compute the contribution margin ratio for each territory as a whole percent, rounded to two decimal places, if required. Coast to Coast Surfboards Inc.Contribution Margin by Territory East Coast West Coast $Sales $Sales Variable cost of goods sold Variable cost of goods sold $Manufacturing margin $Manufacturing margin Variable selling expenses Variable selling expenses $Contribution margin $Contribution margin Contribution margin ratio fill in the blank 160bc0070056ff5_16% fill in the blank
erritory and Product Profitability Analysis Coast to Coast Surfboards Inc. manufactures and sells two styles of surfboards, Atlantic Wave and Pacific Pounder. These surfboards are sold in two regions, East Coast and West Coast. Information about the two surfboards is as follows: Atlantic Wave Pacific Pounder Sales price $400 $350 Variable cost of goods sold per unit (148) (161) Manufacturing margin per unit $252 $189 Variable selling expense per unit (156) (91) Contribution margin per unit $96 $98 The sales unit volume for the territories and products for the period is as follows: East Coast West Coast Atlantic Wave 3,260 1,630 Pacific Pounder 0 1,630 Question Content Area a. Prepare a contribution margin by sales territory report. Compute the contribution margin ratio for each territory as a whole percent, rounded to two decimal places, if required. Coast to Coast Surfboards Inc.Contribution Margin by Territory East Coast West Coast $Sales $Sales Variable cost of goods sold Variable cost of goods sold $Manufacturing margin $Manufacturing margin Variable selling expenses Variable selling expenses $Contribution margin $Contribution margin Contribution margin ratio fill in the blank 160bc0070056ff5_16% fill in the blank
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
erritory and Product Profitability Analysis
Coast to Coast Surfboards Inc. manufactures and sells two styles of surfboards, Atlantic Wave and Pacific Pounder. These surfboards are sold in two regions, East Coast and West Coast. Information about the two surfboards is as follows:
| Atlantic Wave | Pacific Pounder | |||
| Sales price | $400 | $350 | ||
| Variable cost of goods sold per unit | (148) | (161) | ||
| Manufacturing margin per unit | $252 | $189 | ||
| Variable selling expense per unit | (156) | (91) | ||
| Contribution margin per unit | $96 | $98 |
The sales unit volume for the territories and products for the period is as follows:
| East Coast | West Coast | ||||
| Atlantic Wave | 3,260 | 1,630 | |||
| Pacific Pounder | 0 | 1,630 |
Question Content Area
a. Prepare a contribution margin by sales territory report. Compute the contribution margin ratio for each territory as a whole percent, rounded to two decimal places, if required.
| East Coast | West Coast | |
|
|
$Sales | $Sales |
|
|
Variable cost of goods sold | Variable cost of goods sold |
|
|
$Manufacturing margin | $Manufacturing margin |
|
|
Variable selling expenses | Variable selling expenses |
|
|
$Contribution margin | $Contribution margin |
| Contribution margin ratio | fill in the blank 160bc0070056ff5_16% | fill in the blank 160bc0070056ff5_17% |
Expert Solution
Step 1
Contribution Margin :— Contributions Margin is the Difference Between Sales & Variable Cost of the Product.
Contribution margin shows you the aggregate amount of revenue available after variable costs to cover fixed expenses and provide profit to the company.
Contribution Margin Computed :—
= Sales - Variable cost
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