Kylie's Cookies is considering the purchase of a larger oven that will cost $2,200 and will increase her fixed costs by $58. What would happen if she purchased the new oven to realize the variable cost savings of $0.10 per cookie, and what would happen if she raised her price by just $0.20? She feels confident that such a small price increase will decrease the sales by only 30 units and may help her offset the increase in fixed costs. Given the following current prices how would the break-even in units and dollars change if she doesn't increase the selling price and if she does increase the selling price? Complete the monthly contribution margin income statement for each of these cases. Round your answers to two decimal places. Round break-even units to a whole number. Selling Price, Variable Cost and Fixed Cost Change Analysis With Current Price With Decreased VC and Increased FC With Increased SP, Decreased VC, and Increased FC Sales Price per Unit $1.70 $fill in the blank 1 $fill in the blank 2 Variable Cost per Unit 0.40 fill in the blank 3 fill in the blank 4 Contribution Margin per Unit $1.30 $fill in the blank 5 $fill in the blank 6 Fixed Costs $390 $fill in the blank 7 $fill in the blank 8 Break-even in Units 300 fill in the blank 9 fill in the blank 10 Break-even in Dollars $510 $fill in the blank 11 $fill in the blank 12 Monthly Contribution Margin Income Statement With Current Price With Decreased VC and Increased FC With Increased SP, Decreased VC, and Increased FC Unit Sales, Expected 800 fill in the blank 13 fill in the blank 14 Sales $fill in the blank 15 $fill in the blank 16 $fill in the blank 17 Variable Costs fill in the blank 18 fill in the blank 19 fill in the blank 20 Contribution Margin $fill in the blank 21 $fill in the blank 22 $fill in the blank 23 Fixed Costs fill in the blank 24 fill in the blank 25 fill in the blank 26 Net Income $fill in the blank 27 $fill in the blank 28 $fill in the blank 29
Kylie's Cookies is considering the purchase of a larger oven that will cost $2,200 and will increase her fixed costs by $58. What would happen if she purchased the new oven to realize the variable cost savings of $0.10 per cookie, and what would happen if she raised her price by just $0.20? She feels confident that such a small price increase will decrease the sales by only 30 units and may help her offset the increase in fixed costs. Given the following current prices how would the break-even in units and dollars change if she doesn't increase the selling price and if she does increase the selling price? Complete the monthly contribution margin income statement for each of these cases.
Round your answers to two decimal places. Round break-even units to a whole number.
Selling Price, Variable Cost and Fixed Cost Change Analysis | |||
With Current Price |
With Decreased VC and Increased FC |
With Increased SP, Decreased VC, and Increased FC |
|
Sales Price per Unit | $1.70 | $fill in the blank 1 | $fill in the blank 2 |
Variable Cost per Unit | 0.40 | fill in the blank 3 | fill in the blank 4 |
Contribution Margin per Unit | $1.30 | $fill in the blank 5 | $fill in the blank 6 |
Fixed Costs | $390 | $fill in the blank 7 | $fill in the blank 8 |
Break-even in Units | 300 | fill in the blank 9 | fill in the blank 10 |
Break-even in Dollars | $510 | $fill in the blank 11 | $fill in the blank 12 |
Monthly Contribution Margin Income Statement | |||
With Current Price |
With Decreased VC and Increased FC |
With Increased SP, Decreased VC, and Increased FC |
|
Unit Sales, Expected | 800 | fill in the blank 13 | fill in the blank 14 |
Sales | $fill in the blank 15 | $fill in the blank 16 | $fill in the blank 17 |
Variable Costs | fill in the blank 18 | fill in the blank 19 | fill in the blank 20 |
Contribution Margin | $fill in the blank 21 | $fill in the blank 22 | $fill in the blank 23 |
Fixed Costs | fill in the blank 24 | fill in the blank 25 | fill in the blank 26 |
Net Income | $fill in the blank 27 | $fill in the blank 28 | $fill in the blank 29 |
Trending now
This is a popular solution!
Step by step
Solved in 2 steps