Marigold Corp.wants to produce and sell a new flavored water. In order to penetrate the market, the product will have tosell at $2 per 12 oz. bottle. The following data has been collected:Annual salesProjected selling and administrative costsDesired profitThe target cost per bottle isO $0.16.O $0.20.$0.80.O $0.64.55000 bottles$8900$66000

Target Cost per Bottle = Total Costs−Desired Profit / Number of bottles sold

Answered: Marigold Corp.wants to produce and sell…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 20E

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Dana's Ribbon World makes award rosettes. Following is information about the company: Variable cost per rosette Sales price per rosette Total fixed costs per month $ 3.00 6.00 6000.00 Required: 1. Suppose Dana's would like to generate a profit of $1,160. Determine how many rosettes it must sell to achieve this target profit. 2. If Dana's sells 2,180 rosettes, compute its margin of safety in units, in sales dollars, and as a percentage of sales. 3. Calculate Dana's degree of operating leverage if it sells 2,180 rosettes 4a. Using the degree of operating leverage, calculate the change in Dana's profit if unit sales drop to 1,853 units. 4b. Prepare a new contribution margin income statement to verify change in dana's profit.
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Can you help me with CVP Drill # 4?
How many ribbon it must be sell to achhive this target profit
Schylar Pharmaceuticals, Inc., plans to sell 130,000 units of antibiotic at an average price of 22 each in the coming year. Total variable costs equal 1,086,800. Total fixed costs equal 8,000,000. (Round all ratios to four significant digits, and round all dollar amounts to the nearest dollar.) Required: 1. What is the contribution margin per unit? What is the contribution margin ratio? 2. Calculate the sales revenue needed to break even. 3. Calculate the sales revenue needed to achieve a target profit of 245,000. 4. What if the average price per unit increased to 23.50? Recalculate: a. Contribution margin per unit b. Contribution margin ratio (rounded to four decimal places) c. Sales revenue needed to break even d. Sales revenue needed to achieve a target profit of 245,000
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