Exercise 6-1 (Algo) Computing the CM Ratio and Variableast month when Holiday Creations, Incorporated, sold 41,000 units, its sales, variable expenses, and fixed expenses were $164,000,127,920, and $35,700, respectively.Required:What is the company's contribution margin (CM) ratio?What is the company's variable expense ratio?Note: Do not round intermediate calculations.1. Contribution margin ratio2. Variable expense ratio%%

Step 1: Given informationSales = $164,000Units = 41,000Variable expense = $127,920 Step 2:…

Answered: Exercise 6-1 (Algo) Computing the CM…

Principles of Accounting Volume 2

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Author:OpenStax

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Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 4PB: West Island distributes a single product. The companys sales and expenses for the month of June are...

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2.Question 5 pts Sees Corp., a merchandising company, reported the following results for July. Cost of Goods Sold 276,213 Fixed selling and administrative expense 55,665 Sales Revenue 541,967 ar sign or the calculat Variable selling and administrative expense 56,728 This question is independent of all other questions. Please use only the information in this question to calculate the answer. Based on the information provided above, calculate the Contribution Margin for July. Cost of Goods Sold is a variable cost in this company. Enter only the amount of the Contribution Margin in the box provided below. Enter the amount only. Do not enter letters, words, or the calculation. ministrativ THHE ning A or gaitas vd s on il grinismoy sal 10 nudi zaol at zinvonis visas worla of 313 Loy 15 of gollesio 30 enoilointantis wel
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Draw V Type here to search Read aloud 7-2B-CVP Analysis, "What if?" Analysis Kevin Co.'s projected contribution-format income statement for the upcoming month is shown below: Sales (500 units) Variable expenses Contribution margin local or shared file Fixed expenses Net operating income $10,000 4,000 6,000 1,000 $5,000 Required: a.) Compute the breakeven point in units. b.) Compute the breakeven point in dollars. c.) If the company wishes to earn a monthly target profit of $10,000, how many units must be sold each month? d.) Compute the company's margin of safety. State your answer in both dollar and percentage terms. e.) The company's manager thinks that adding a salaried sales staff member at a cost of $2,000 per month will increase sales by $4,000 per month. If he is correct, what will be the net dollar advantage or disadvantage of making this change? f.) Refer to the original data, the company's manager believes that a new production process will improve profitability He plans to…
Anchor Company manufactures a variety of tool boxes. The firm is currently operating at 80% of its full capacity of 6,000 machine- hours per month. Each unit requires 30 minutes of machine time. Its sales manager has been looking for special orders to make productive use of the excess capacity. JCL Ltd., a potential customer, has offered to buy 10,000 tool boxes at $11.90 per box, provided that the entire quantity is delivered in two months. The current per-box cost data are as follows: Direct materials. Direct labour (½ hour at $10.40/hour) Total manufacturing overhead Total unit product cost $ 3.60 5.20 3.10 $11.90 Both fixed and variable overhead are allocated using direct labour-hours as a base. Variable overhead is $2.60 per direct labour-hour. Without the order, Anchor would have enough business to operate at 4,800 direct labour-hours in each of the next two months. The regular selling price of the tool boxes is $14.90. A sales commission of 50 cents per unit is paid to sales…
01:09:21 ook nt nces Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for the two games appears below: Sales Variable expenses Contribution margin Fixed expenses Net operating income Required 1 Required 2 Claimjumper $ 63,900 42,600 $ 21,300 Sales Variable expenses Contribution margin Required: 1. What is the overall contribution margin (CM) ratio for the company? 2. What is the company's overall break-even point in dollar sales? 3. Prepare a contribution format income statement at the company's break-even point that shows the appropriate levels of sales for the two products. Fixed expenses Net operating income (loss) Complete this question by entering your answers in the tabs below. Required 3 Makeover $21,300,000 106,500 42,600 $ Prepare a contribution format income statement at the company's break-even point that sh for the two products. (Do not round intermediate calculations. Round your answers to the r…
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Problem 12-21 (Algo) Prepare a contribution margin format income statement; answer what-if questions LO 12-7, 12-8, 12-9 Shown here is an income statement in the traditional format for a firm with a sales volume of 7,500 units. Cost formulas also are shown: Revenues Cost of goods sold ($5,900 + $2.25/unit) Gross profit Operating expenses: Selling ($1,200 + $0.10/unit) Administrative ($3,500 + $0.20/unit) Operating income $34,400 22,775 $ 11,625 1,950 5,000 $ 4,675 Required: a. Prepare an income statement in the contribution margin format. b. Calculate the contribution margin per unit and the contribution margin ratio. c. Calculate the firm's operating income (or loss) if the volume changed from 7,500 units to 1. 11,250 units. 2. 3,750 units. d. Refer to your answer to part a for total revenues of $34,400. Calculate the firm's operating income (or loss) if unit selling price and variable expenses per unit do not change and total revenues 1. Increase by $14,500. 2. Decrease by $3,000.
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