Financial & Managerial Accounting
13th Edition
ISBN: 9781285866307
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Question
Chapter 19, Problem 19.2BPE
(A)
To determine
Contribution Margin ratio:
It is a ratio that measures the contribution margin generated by the company from the sales to make it avialable for paying the fixed cost and generate a profit. It is expressed as percentage of margin available from each dollar sales to pay fixed expenses and to provide profit. It is also called as profit-volume ratio. The formula to calculate the contribution margin ratio is as follows:
To determine: contribution margin ratio.
(B)
To determine
the unit contribution margin.
(C)
To determine
the income from operations.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Please give me answer
ABC Company sells 10,300 units at OMR 10 per unit. Variable costs are OMR 7.5 per unit, and
total fixed costs are OMR 12,500.
Requirements:
Calculate the following using the CM method:
(a) the contribution margin ratio
(b) income from operations.
Contribution Margin
Morrison Company sells 124,000 units at $16 per unit. Variable costs are $12 per unit, and fixed costs are $144,000.Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) income from operations.
a. Contribution margin ratiob. Unit contribution marginc. Income from operations
Chapter 19 Solutions
Financial & Managerial Accounting
Ch. 19 - Describe how total variable costs and unit...Ch. 19 - Which of the following costs would be classified...Ch. 19 - Describe how total fixed costs and unit fixed...Ch. 19 - In applying the high-low method of cost estimation...Ch. 19 - If fixed costs increase, what would be the impact...Ch. 19 - Prob. 6DQCh. 19 - If the unit cost of direct materials is decreased,...Ch. 19 - Both Austin Company and Hill Company had the same...Ch. 19 - Prob. 9DQCh. 19 - Prob. 10DQ
Ch. 19 - High-low method The manufacturing costs of...Ch. 19 - Prob. 19.1BPECh. 19 - Prob. 19.2APECh. 19 - Prob. 19.2BPECh. 19 - Prob. 19.3APECh. 19 - Prob. 19.3BPECh. 19 - Prob. 19.4APECh. 19 - Prob. 19.4BPECh. 19 - Sales mix and break-even analysis Wide Open...Ch. 19 - Prob. 19.5BPECh. 19 - Operating leverage SungSam Enterprises reports the...Ch. 19 - Prob. 19.6BPECh. 19 - Prob. 19.7APECh. 19 - Prob. 19.7BPECh. 19 - Classify costs Following is a list of various...Ch. 19 - Identify cost graphs The following cost graphs...Ch. 19 - Prob. 19.3EXCh. 19 - Identify activity bases From the following list of...Ch. 19 - Identify fixed and variable costs Intuit Inc....Ch. 19 - Prob. 19.6EXCh. 19 - High-low method Diamond Inc. has decided to use...Ch. 19 - High-low method for a service company Boston...Ch. 19 - Contribution margin ratio a. Segar Company budgets...Ch. 19 - Contribution margin and contribution margin ratio...Ch. 19 - Prob. 19.11EXCh. 19 - Prob. 19.12EXCh. 19 - Prob. 19.13EXCh. 19 - Prob. 19.14EXCh. 19 - Prob. 19.15EXCh. 19 - Break even analysis for a service company Sprint...Ch. 19 - Prob. 19.17EXCh. 19 - Prob. 19.18EXCh. 19 - Prob. 19.19EXCh. 19 - Prob. 19.20EXCh. 19 - Prob. 19.21EXCh. 19 - Break-even sales and sales mix for a service...Ch. 19 - Margin of safety A. If Canace Company, with a...Ch. 19 - Prob. 19.24EXCh. 19 - Operating leverage Beck Inc. and Bryant Inc. have...Ch. 19 - Prob. 19.26EXCh. 19 - Variable costing income statement On July 31,...Ch. 19 - Absorption costing income statement On June 30,...Ch. 19 - Classify costs Seymour Clothing Co. manufactures a...Ch. 19 - Break-even sales under present and proposed...Ch. 19 - Prob. 19.3APRCh. 19 - Prob. 19.4APRCh. 19 - Prob. 19.5APRCh. 19 - Contribution margin, break-even sales,...Ch. 19 - Classify costs Cromwell Furniture Company...Ch. 19 - Prob. 19.2BPRCh. 19 - Break even sales and cost-volume-profit chart For...Ch. 19 - Prob. 19.4BPRCh. 19 - Sales mix and break even sales Data related to the...Ch. 19 - Prob. 19.6BPRCh. 19 - Prob. 19.1CPCh. 19 - Break-even analysis Somerset Inc. has finished a...Ch. 19 - Prob. 19.4CPCh. 19 - Prob. 19.5CP
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- A product has a sales price of $250 and a per-unit contribution margin of $75. What is the contribution margin ratio?arrow_forwardSuppose that a company has fixed costs of $18 per unit and variable costs $9 per unit when 15,000 units are produced. What are the fixed costs per unit when 12,000 units are produced?arrow_forwardLotts Company produces and sells one product. The selling price is 10, and the unit variable cost is 6. Total fixed cost is 10,000. Required: 1. Prepare a CVP graph with Units Sold as the horizontal axis and Dollars as the vertical axis. Label the break-even point on the horizontal axis. 2. Prepare CVP graphs for each of the following independent scenarios: (a) Fixed cost increases by 5,000, (b) Unit variable cost increases to 7, (c) Unit selling price increases to 12, and (d) Fixed cost increases by 5,000 and unit variable cost is 7.arrow_forward
- Calculate the per-unit contribution margin of a product that has a sale price of $200 if the variable costs per unit are $65.arrow_forwardBluegill Company sells 8,900 units at $320 per unit. Fixed costs are $142,400, and income from operations is $1,566,400. Determine the following: a. Variable cost per unitb. Unit contribution marginc. Contribution margin ratioarrow_forwardBluegill Company sells 16,700 units at $260 per unit. Fixed costs are $217,100, and operating income is $2,388,100. Determine the following: a. Variable cost per unit b. Unit contribution margin c. Contribution margin ratio %arrow_forward
- Bluegill Company sells 12,500 units at $300 per unit. Fixed costs are $187,500, and operating income is $2,437,500. Determine the (a) variable cost per unit, (b) unit contribution margin, and (c) contribution margin ratio. Round the contribution margin ratio to two decimal places. a. Variable cost per unit b. Unit contribution margin c. Contribution margin ratio % per unitarrow_forwardFerrante Company sells 24,000 units at $22 per unit. Variable costs are $12.54 per unit, and fixed costs are $88,500. Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) income from operations.arrow_forwardBluegill Company sells 15,500 units at $220 per unit. Fixed costs are $170,500, and operating income is $1,534,500. Determine the following: a. Variable cost per unit b. Unit contribution margin c. Contribution margin ratio $ per unit %arrow_forward
- Contribution margin Amon Company sells 180,000 units at $185 per unit. Variable costs are $111 per unit, and fixed costs are $8,175,000. Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) operating income. a. Contribution margin ratio b. Unit contribution margin $ c. Operating income LA % per unitarrow_forwardWillie Company sells 39,000 units at $21 per unit. Variable costs are $14.70 per unit, and fixed costs are $76,200. Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) income from operations. a. Contribution margin ratio (Enter as a whole number.) % b. Unit contribution margin (Round to the nearest cent.) $ per unit c. Income from operationsarrow_forwardMolly Company sells 29,000 units at $48 per unit. Variable costs are $27.36 per unit, and fixed costs are $323,200. Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) income from operations.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Cost-Volume-Profit (CVP) Analysis and Break-Even Analysis Step-by-Step, by Mike Werner; Author: Accounting Step by Step;https://www.youtube.com/watch?v=D0MOfse9OWk;License: Standard Youtube License