1-8

1. Their The income statement that a company makes available for use by external decision makers is the: a. contribution income statement b. direct income statement C. functional income statement d. variable income statement Arlene's Art Supplies is trying to determine how much each folio board contributes toward fixed costs. The boards sell for $9.00 each and Arlene pays $4.75 for each board. Arlene pays her employees a commission of 10% and the administrative costs are 5% of sales. What is the contribution margin for each folio board? a. $5.20 b. $2.80 c. $3.40 d. $2.90 The Duchess Bakery makes and sells fresh cookies. If the cookies sell for $1.60 each and they cost $0.85 to make plus an additional 20% of the selling price for selling and administrative variable costs, the contribution margin ratio is: a. 26.875% b. 18.000% c. 27.125% d. 53.125% Tim's Taco Stand sells tacos for $0.95 each. The cost to make each taco is $0.55. If the fixed costs are $600 per month, how many tacos must he sell to break even? a. 2,000 b. 1,500 c. 3,555 d. 5,334 Tim's Taco Stand sells tacos for $0.95 each. The cost to make each taco is $0.55. If the fixed costs are $600 per month, what are the total sales he needs to break even? a. $ 800 b. $1,000 C. $1,425 d. $2,000 Tim's Taco Stand sells tacos for $0.95 each. The cost to make each taco is $0.55. If the fixed costs are $600 per month and Time wants to make a $1,000 profit, how many tacos much he sell? a. 4,000 b. 3,333 c. 3,555 d. 5,334 Tim's Taco Stand sells tacos for $0.95 each. The cost to make each taco is $0.55. If the fixed costs are $600 per month and Tim wants to make a $1,000 profit, how many dollars of tacos must he sell? a. $2,667 b. $4,000 C. $3,555 d. $3,800 The key element of a contribution income statement is that costs are separated into: a. fixed and variable b. product and fixed c. product and period d. variable and period