The section of Waterways that produces controllers for the company provided the following information. Sales for month of February: Unit variable manufacturing cost: 3,800 $10.00 Unit selling price: $43.00 Fixed manufacturing overhead cost (per month for controllers): $83,000 Unit variable selling and administrative costs: $2.90 Fixed selling and administrative expenses (per month for controllers): $13.950 Using this information for the controllers, determine the contribution margin ratio, the degree of operating leverage, the break-even point in sales dollars, and the margin of safety ratio for Waterways Corporation on this product. Contribution Margin Ratio (Round to O decimal places, e.g. 25%.) Degree of Operating Leverage (Round to 2 decimal places, e.g. 5.25.) Break-even Point in Dollars $ 72 %
The section of Waterways that produces controllers for the company provided the following information. Sales for month of February: Unit variable manufacturing cost: 3,800 $10.00 Unit selling price: $43.00 Fixed manufacturing overhead cost (per month for controllers): $83,000 Unit variable selling and administrative costs: $2.90 Fixed selling and administrative expenses (per month for controllers): $13.950 Using this information for the controllers, determine the contribution margin ratio, the degree of operating leverage, the break-even point in sales dollars, and the margin of safety ratio for Waterways Corporation on this product. Contribution Margin Ratio (Round to O decimal places, e.g. 25%.) Degree of Operating Leverage (Round to 2 decimal places, e.g. 5.25.) Break-even Point in Dollars $ 72 %
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The section of Waterways that produces controllers for the company provided the following information.
Sales for month of February:
Unit variable manufacturing cost:
3,800
$10.00
Unit selling price:
$43.00
Fixed manufacturing overhead cost (per month for controllers):
$83,000
Unit variable selling and administrative costs:
$2.90
Fixed selling and administrative expenses (per month for controllers): $13.950
Using this information for the controllers, determine the contribution margin ratio, the degree of operating leverage, the break-even
point in sales dollars, and the margin of safety ratio for Waterways Corporation on this product.
Contribution Margin Ratio (Round to O decimal places, e.g. 25%.)
Degree of Operating Leverage (Round to 2 decimal places, e.g. 5.25.)
Break-even Point in Dollars
$
72
%
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