Question
1.) Super-Tee Co. plans to sell 12,000 T-shirts at $16 each in the coming year. Product costs include: Direct materials per shirt $5.75 Direct labor
1.) Super-Tee Co. plans to sell 12,000 T-shirts at $16 each in the coming year. Product costs include:
Direct materials per shirt $5.75
Direct labor per shirt 1.25
Variable overhead per shirt .60
Fixed overhead in total $43,000
What is the company's contribution margin?
a.) | $9.00 | |
b.) $4.82 | ||
c.) $10.25 | ||
d.) $8.40 |
2.) Super-Tee has a contribution margin of 25%. How many T-shirts (rounded to the nearest shirt) must be sold in order for the company to break even?
a.) 3,583 | ||||||||||||||||||||||||||
b.) 10,750 T-shirts | ||||||||||||||||||||||||||
c.) 5,375 T-shirts | ||||||||||||||||||||||||||
d.) 172,000 T-shirts
3.) If Super-Tee has a contribution margin per T-shirt of $5.00. How many shirts must be sold in order to earn of profit of $20,000?
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