Cost/Variable CostsFixed CostsCostAmountLifeAmountMaterialsCostAmountAmount/ShakeCost/ShakeLabor$15.00$20.00$10.00$24.00$0.40$0.75$250Whole Milk640 oz3 oz2 PT Employees$800 employee ConstantCream128 oz3 ozOther Fixed Costs3/4 cup9 oz1 servingSugar30 cupsShack Rental$500monthConstant$100$72/machine$480$1,200$108$600$100$211.85/moPremium Van. Ice Cream600 ozCleaning and other suppliesmonthConstantFlavorings1 servingEquipment: Shake Maker1036 monthsFlavored Straws1 straw1 strawEquipment: Fridge/Freezer120 months500 cups1 cup120 monthsCupsAdditional Variable Cost per unitCountertops1per shakeTables and benches10 sets36 monthsTotal Variable Cost per unit (with commission)per shakeAnnual Insurance112 monthsSignagemonthConstantLoan Interest124 monthsTotal Fixed Costs per monthper month Revenue per Unit$10.00Commission (variable cost)$1.00Fill in highlighted cells while including formulasused.1) What is the contribution margin per unit?2) What is the break even point per month?3) With salary of $4,000/month, what is thebreak even point?

It is the point at which the company will be in a no-profit or no-loss situation. In other words,…

Answered: Revenue per Unit $10.00 Commission…

Business

Accounting

Revenue per Unit $10.00 Commission (variable cost) $1.00 Fill in highlighted cells while including formulas used.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Management by Exception

A manager’s job is a very tough one. A manager needs to look at the various areas of work and as a manager he has to look after two or more important jobs or activities at the same time for the growth of the business. In order to do all these things in an effective manner, a manager must adopt or practice different management styles and tactics.

Question

Cost/
Variable Costs
Fixed Costs
Cost
Amount
Life
Amount
Materials
Cost
Amount
Amount/Shake
Cost/Shake
Labor
$15.00
$20.00
$10.00
$24.00
$0.40
$0.75
$250
Whole Milk
640 oz
3 oz
2 PT Employees
$800 employee Constant
Cream
128 oz
3 oz
Other Fixed Costs
3/4 cup
9 oz
1 serving
Sugar
30 cups
Shack Rental
$500
month
Constant
$100
$72/machine
$480
$1,200
$108
$600
$100
$211.85/mo
Premium Van. Ice Cream
600 oz
Cleaning and other supplies
month
Constant
Flavorings
1 serving
Equipment: Shake Maker
10
36 months
Flavored Straws
1 straw
1 straw
Equipment: Fridge/Freezer
120 months
500 cups
1 cup
120 months
Cups
Additional Variable Cost per unit
Countertops
1
per shake
Tables and benches
10 sets
36 months
Total Variable Cost per unit (with commission)
per shake
Annual Insurance
1
12 months
Signage
month
Constant
Loan Interest
1
24 months
Total Fixed Costs per month
per month

Revenue per Unit
$10.00
Commission (variable cost)
$1.00
Fill in highlighted cells while including formulas
used.
1) What is the contribution margin per unit?
2) What is the break even point per month?
3) With salary of $4,000/month, what is the
break even point?

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(1) Determine the contribution margin per unit:

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(2) Determine the break-even point per month:

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(3) Determine the break-even point per month, with salary of $4,000 per month:

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