Homework Problems- Chapter 11 Given the following information: $ 144,000.00 Fixed Costs Variable cost per unit Selling price per unit # Units sold 7.00 10.00 30,000 Calculate the Contribution Margin Calculate the Contribution Margin Ratio 3 Calculate the Unit Contribution Margin Calculate the Break-Even Sales Units
Homework Problems- Chapter 11 Given the following information: $ 144,000.00 Fixed Costs Variable cost per unit Selling price per unit # Units sold 7.00 10.00 30,000 Calculate the Contribution Margin Calculate the Contribution Margin Ratio 3 Calculate the Unit Contribution Margin Calculate the Break-Even Sales Units
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter11: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 11.16E
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Transcribed Image Text:Homework Problems- Chapter 11
Given the following information:
$ 144,000.00
Fixed Costs
Variable cost per unit
Selling price per unit
# Units sold
7.00
10.00
30,000
Calculate the Contribution Margin
Calculate the Contribution Margin Ratio
3
Calculate the Unit Contribution Margin
Calculate the Break-Even Sales Units
Expert Solution
Step 1
Variable cost: A variable cost is a expense that changes or vary in proportion to production output. Variable costs increase or decrease depending on a company's production volume; they rise as production increases and fall as production decreases.
Fixed Cost: A fixed cost is an expense that does not change or vary with the production volume. In other words, fixed costs are locked in place as long as operations stay within a certain size. Fixed costs are less controllable than variable cost because they aren’t based on volume or operations.
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