Coast to Coast Surfboards Inc. manufactures and sells two styles of surfboards, Atlantic Wave and Pacific Pounder. These surfboards are sold in two regions, East Coast and West Coast.Information about the two surfboards is as follows: Atlantic Wave Pacific Pounder Sales price $450 $400 Variable cost of goods sold per unit (167) (192) Manufacturing margin per unit $283$208 Variable selling expense per unit (202) (112) Contribution margin per unit $81 $96 The sales unit volume for the territories and products for the period is as follows: East Coast WestCoast Atlantic Wave 2,440 1,220 Pacific Pounder 0 1,220 Question Content Area a . Prepare a contribution margin by sales territory report. Compute the contribution margin ratio for eachterritory as a whole percent, rounded to two decimal places, if required. SalesCoast to Coast Surfboards Inc.Contribution Margin by TerritoryVariable cost of goods soldManufacturing marginVariable selling expensesContribution marginContribution margin ratioEast Coast%West Coast%

Contribution Margin :— It is the difference between sales revenue and total variable cost.…

Answered: Sales Coast to Coast Surfboards Inc.…

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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(a) What is the gross margin now? (b) What is the net operating income now? (c) What is the contribution margin now?
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Contribution Margin, Break-Even Sales, Cost-Volume-Profit Chart, Margin of Safety, and Operating Leverage Belmain Co. expects to maintain the same inventories at the end of 20Y7 as at the beginning of the year. The total of all production costs for the year is therefore assumed to be equal to the cost of goods sold. With this in mind, the various department heads were asked to submit estimates of the costs for their departments during the year. A summary report of these estimates is as follows: Estimated Estimated Variable Cost Fixed Cost (per unit sold) Production costs: Direct materials $50.00 Direct labor 30.00 Factory overhead $350,000 6.00 Selling expenses: Sales salaries and commissions 340,000 4.00 Advertising 116,000 Travel 4,000 Miscellaneous selling expense 2,300 1.00 Administrative expenses: Office and officers' salaries 325,000 Supplies 6,000 4.00 Miscellaneous administrative expense 8,700 1.00 Total $1,152,000 $96.00 It is expected that 12,000 units will be sold at a price…
V. Prepare a CONTRIBUTION MARGIN (also known as variable costing) income statement given a traditional (also known as absorption costing) income statement Bruno Industries manufactures and sells a single product. The controller has prepared the following income statement for the most recent year: B C D 1 2 3 Bruno Industries Traditional Income Statement (Absorption Costing) For the Year Ended December 31 4 5 Sales revenue 6 Less: Cost of goods sold 7 Gross profit 8 Less: Operating expenses 9 Operating income $ 406,000 329,000 $ 77,000 73,000 $ 4,000 10 The company produced 8,000 units and sold 7,000 units during the year ending December 31. Fixed manufacturing overhead (MOH) for the year was $152,000, while fixed operating expenses were $62,000. The company had no beginning inventory. Requirements 1. Will the company's operating income under variable costing be higher, lower, or the same as its operating income under absorption costing? Why? 2. Prepare a variable costing income…
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Sales Coast to Coast Surfboards Inc. Contribution Margin by Territory Variable cost of goods sold Manufacturing margin Variable selling expenses Contribution margin Contribution margin ratio $ East Coast $ % West Coast $ %