Rhetorix, Inc., produces stereo speakers. The selling price per pair of speakers is $1,000. The variable cost

Question:

Rhetorix, Inc., produces stereo speakers. The selling price per pair of speakers is $1,000. The variable cost of production is $300 and the fixed cost per month is $49,000.
Required
a. Calculate the associated with a pair of speakers.
b. In August, the company sold eight more pairs of speakers than planned. What is the expected effect on profit of selling the additional speakers?
c. Calculate the ratio for Rhetorix associated with a pair of speakers.
d. In October, the company had sales that were $10,000 higher than planned. What is the expected effect on profit related to the additional sales?
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...