Jimson Company manufactures nylon purses Variable costs are $37 per purse, the price is $55, and fixed costs are $41,400 Required 1 What is the contribution margin for one purse 2 How many purses must Jimson Company sell to break even 3 If Jimson Company sells 6,000 purses, what is the operating in...

1 Contribution margin Price Variable costs 55 37 1 ...

Jimson Company manufactures nylon purses. Variable costs are $37 per purse, the price is $55, and fixed

Question:

Jimson Company manufactures nylon purses. Variable costs are $37 per purse, the price is $55, and fixed costs are $41,400.
Required:
1. What is the for one purse?
2. How many purses must Jimson Company sell to break even?
3. If Jimson Company sells 6,000 purses, what is the operating income?

Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...