Mountain Peak Company plans to sell 5,000 camping tents at $85 each in the coming year. Unit variable cost is $50.40 (which includes direct materials, direct labor, variable factory overhead, and variable selling expense). Fixed factory overhead is $25,000 and fixed selling and administrative expenses are $36,000. 1. Calculate the variable cost ratio.. 2. Calculate the contribution margin ratio.

Mountain Peak Company plans to sell 5,000 camping tents at $85 each in the coming year. Unit variable cost is $50.40 (which includes direct materials, direct labor, variable factory overhead, and variable selling expense). Fixed factory overhead is $25,000 and fixed selling and administrative expenses are $36,000. 1. Calculate the variable cost ratio.. 2. Calculate the contribution margin ratio.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter7: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 26BEB: Variable Cost Ratio, Contribution Margin Ratio Chillmax Company plans to sell 3,500 pairs of shoes...

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