Answered: herri’s Tan-O-Rama is a local tanning…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 5CE: Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each...

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Question

herri’s Tan-O-Rama is a local tanning salon. Its regression output is as follows:

	Coefficients
Intercept	4,630.34
X Variable 1	2.33

Suppose that the company charges $7.20 per tanning session.

Required:

1. Calculate the unit contribution margin.
2. Calculate contribution margin ratio.
3. Calculate the total contribution margin if the shop books 1,400 tanning sessions this month.

Complete this question by entering your answers in the tabs below.

Unit CM
CM Ratio
Total CM

Calculate the unit contribution margin. (Round your final answer to 2 decimal places.)


			=	Unit Contribution Margin

Unit CM
CM

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