Mirabel Cosmetics manufactures and sells a face cream to small family-run stores in the greater Montreal area. It presents the monthly operating statement of comprehensive income shown here to François Laval, a potential investor in the business. Help Laval understand Mirabel's cost structure.

Required
1. Recast the statement of comprehensive income to emphasize contribution margin.
2. Calculate the contribution margin percentage and breakeven point in units and revenues for June 2016.
3. What is the margin of safety (in units) for June 2016?
4. If sales in June were only 8,000 units and Mirabel's tax rate is 30%, calculate its net income.

Transcribed Image Text:

Mirabel Cosmetics Operating Statement of Comprehensive Income for the Month of June 2016 Units sold Revenue Cost of goods sold 10,000 $100,000 $55,000 20,000 Variable manufacturing costs Fixed manufacturing costs Total Gross margin Operating costs 75,000 25,000 Variable marketing costs Fixed marketing and administration costs 5,000 10,000 Total operating costs Operating income 15,000 10,000