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Joyce Murphy runs a courier service in downtown Seattle. She charges clients $0.64 per mile driven. Joyce has determined that if she drives 2,350 miles in a month, her total operating cost is $675. If she drives 3,450 miles in a month, her total operating cost is $939.
Required:
1. Using the high-low method, determine Joyce’s variable and fixed operating cost components.
2. Complete the contribution margin income statement for Joyce’s service assuming she drove 1,500 miles last month. (Assume this falls within the relevant range of operations).
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- Milden Company is a distributor who wants to start using a contribution format income statement for planning purposes. The company has analyzed its expenses and developed the following cost formulas: Cost Cost Formula Cost of good sold $31 per unit sold Advertising expense $187,000 per quarter Sales commissions 7% of sales Shipping expense? Administrative salaries $97,000 per quarter Insurance expense $10,700 per quarter Depreciation expense $67,000 per quarter Because shipping expense is a mixed cost, the company needs to estimate the variable shipping expense per unit sold and the fixed shipping expense per quarter using the following data: Shipping Expense Year 1: First 33,000 $177,000 Second 35,000 $ 192,000 Third 40,000 $234,000 Fourth 36,000 $ 197,000 Year 2: First 34,000 $ 187,000 Second 37,000 $ 202,000 Third 48,750 $ 240,000 Fourth 45,750 $ 216,000 Required: 1. Using the high- low method, estimate a cost formula for shipping expense in the form Y = a + bX. 2. In the first…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 CMA jeans maker is designing a new line of jeans called Slams. Slams will sell for $205 per unit and cost $164 per unit in variable costs to make. Fixed costs total $60,000. 1. Compute the contribution margin per unit. Contribution margin 2. Compute the contribution margin ratio. Numerator: I Denominator: 1 3. Compute income if 5,000 units are produced and sold. Income Contribution Margin Ratio = Contribution margin ratio 0
- Feather Friends, Incorporated, distributes a high-quality wooden birdhouse that sells for $40 per unit. Variable expenses are $20.00 per unit, and fixed expenses total $200,000 per year. Its operating results for last year were as follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income Required: Answer each question independently based on the original data: 1. What is the product's CM ratio? 2. Use the CM ratio to determine the break-even point in dollar sales. 3. Assume this year's unit sales and total sales increase by 59,000 units and $2,360,000, respectively. If the fixed expenses do not change, how much will net operating income increase? $ 1,000,000 500,000 500,000 200,000 $ 300,000 4-a. What is the degree of operating leverage based on last year's sales? 4-b. Assume the president expects this year's unit sales to increase by 19%. Using the degree of operating leverage from last year, what percentage increase in net operating income will the…Please help me with all answers thankuSurf Company can sell all of the two surfboard models it produces, but it has only 424 direct labor hours available. The Glide model requires 2 direct labor hours per unit. The Ultra model requires 4 direct labor hours per unit. Contribution margin per unit is $224 for Glide and $348 for Ultra. (a) Compute the contribution margin per direct labor hour for each product. (b) Determine the best sales mix and the resulting contribution margin. Complete this question by entering your answers in the tabs below. Required A Required B Compute the contribution margin per direct labor hour for each product. Glide Ultra Contribution margin per direct labor hour
- Surf Company can sell all of the two surfboard models it produces, but it has only 416 direct labor hours available. The Glide model requires 2 direct labor hours per unit. The Ultra model requires 4 direct labor hours per unit. Contribution margin per unit is $216 for Glide and $332 for Ultra. (a) Compute the contribution margin per direct labor hour for each product. (b) Determine the best sales mix and the resulting contribution margin. Complete this question by entering your answers in the tabs below. Required A Required B Compute the contribution margin per direct labor hour for each product. Glide Ultra Contribution margin per direct labor hour $ $A jeans maker is designing a new line of jeans called Slims. The jeans will sell for $285 per pair and cost $176.70 per pair in variable costs to make. (Round your answers to 2 decimal places.) (1) Compute the contribution margin per pair. Contribution margin (2) Compute the contribution margin ratio. Choose Numerator: Choose Denominator: Contribution Margin Ratio Contribution margin ratiocan you help me with the last two questions, please
- Joyce Murphy runs a courier service in downtown Seattle. She charges clients $0.62 per mile driven. Joyce has determined that if she drives 2,450 miles in a month, her total operating cost is $725. If she drives 3,550 miles in a month, her total operating cost is $857. Required: 1. Using the high-low method, determine Joyce's variable and fixed operating cost components. 2. Complete the contribution margin income statement for Joyce's service assuming she drove 1,600 miles last month. (Assume this falls within the relevant range of operations).Sandy Bank, Incorporated, makes one model of wooden canoe. Partial information is given below. Required: 1. Complete the following table. 2. Suppose Sandy Bank sells its canoes for $540 each. Calculate the contribution margin per canoe and the contribution margin ratio. 3. This year Sandy Bank expects to sell 760 canoes for $540 each. Prepare a contribution margin income statement for the company. 4. Calculate Sandy Bank's break-even point in units and in sales dollars. Sandy Bank sells its canoes for $540 each. 5. Suppose Sandy Bank wants to earn $76,000 profit this year. Calculate the number of canoes that must be sold to achieve this target. Sandy Bank sells its canoes for $540 each. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 This year Sandy Bank expects to sell 760 canoes for $540 each. Prepare a contribution margin income statement for the company. Note: Round your intermediate calculations to 2 decimal…Directions Below is information for Blue Company. Using this information, answer the following questions on the "Calculation" tab in the file. Show your work (how you got your answer) and format appropriately. Blue company has prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 to 1,500 units): Sales $ 20,000 Variable expenses 12,000 Contribution margin 8,000 NOTE: Use the amounts in the original fact pattern to the left as your basis for the questions below. Fixed expenses 6,000 Net operating income $ 2,000 Questions:…
