1.

With the information for the first four months of production, determine the variable cost per unit and the fixed

cost using the high-low method.

Total Cost

Units Produced

January

$155,100

9,000

February

166,350

9,750

March

158,100

9,200

April

157,350

9,150

2.

For 20Y5, Moores Mowers had total sales of $42,000, with each product selling for $15 each. Each product had

variable costs of $8. Calculate the (a) contribution margin, (b) contribution margin ratio, and (c) unit contribution

margin. Round contribution margin ratio to the nearest percent.

3.

Use the following information to determine the change in income from operations for each situation if the

company sells its products for $4 each.

a.

Contribution margin ratio of 35% and a 10,000 increase in sales units.

b.

Unit contribution margin of $2.10 and an increase of $20,000 in sales.

c.

Contribution margin ratio of 30% and an increase in sales of $30,000.

4.

During 20Y5, Jackson Computer Supply produced income from operations of $95,000 from sales of 80,000 units at

$2.50 each. The companys fixed costs totaled $22,000. If the company has a 4,000 increase in sales units in the

upcoming year, what will income from operations be for 20Y6? Assume that fixed costs and the selling price and

variable cost per unit will remain the same.