3. Discuss the importance of Excel Q5 calculations to Wicked Mikes Manufacturing (BE, TP, CM% and MOS). Give examples supported by new numbers (new spreadsheet) of how you would use these calculations as the CFO of the company. Fully discuss the differences between the traditional vs CVP format (minimum of 3).

Excel Q5 complete in screenshot below:

5. Prepare three CVP Income Statements using the following yearly volumes: 500, 2000 and 2500. Keep in mind how variable and fixed costs behave. The traditional income statement from #4 should be about the same net income as the 2000 units for the CVP format. In addition, Q1, should agree to the total fixed costs and per unit variable costs for these schedules. (see PowerPoint from chat the week of the project for format) a) Calculate Break-even in units and sales $ for the company b) Contribution margin ratio c) Calculate units and sales $ if the company wants a profit of $1,000,000. d) Margin of safety in dollars for 2000 units.

Average costs are shown below. Manufacturing Overhead Salaries for factory supervisor, janitor and security $400,000.00 Income Statement Factory Rent $100,000.00 Sales In Units SOO 2000 2500 Depredation for factory equipment $85,000.00 Sales In Revenue $6,088,912 50 $24,355,650 00 $30,444,562 50 Factory Property Taxes $16,000.00 Less: Variable Cost Maintenance for factory equipment $80,000.00 Direct Materials $3.250,000.00 $13,000,000.00 $16,250,000.00 Total Fixed Manufacturing Overhead $681,000.00 kinect Labor $270,000.00 $1,080,000.00 $1,350,000 00 Per Unit $340 50 Variable selling and administrative $129,750.00 $519,000 00 $648,750.00 Floved seling and administrative expense Total Variable Cost $3,649,750.00 $14.599,000 00 $18,248,750.00 Salaries - office and administrative $650,000 00 Contribution Margin $2,439,162 50 $9,756,650.00 $12,195,812 50 Office Rent $350,000.00 Less Fixed Cost Insurance . office $60,000.00 Fixed Manufacturing overhead $681,000.00 $681,000.00 $681,000.00 Depreciation . office equipment $40,000.00 Variable selling and administrative $1,320,000.00 $1,320,000.00 $1, 320,000.00 Advertising $220,000.00 Total Fixed Cost $2,001,000.00 $2,001,000.00 $2,001,000.00 Total Fixed Selling and Administration Experse $1,320,000.00 Net income (loss $438,162 50 $7,795,650.00 $10,194,812 50 Per Unit $860.00 Variable Selling and Administrative Office utilities and Misc office expenses $45,000 00 Sales Travel $24,000.00 Sales Commission $450,000.00 Total Variable Selling and Administrative Expense $519,000.00 Per Unit $259 50 Computation of Cost Per Unit Direct Material Cost $6,500.00 Direct Labor Cost $540.00 Fixed Manufacturing Overhead $340 50 Total Cost Per Unit $7.380 50 Markup at 65%% $4,797 32 Selling Price Per Unit $12,177 23 A. Break Even Sales Selling Price Per Unit $12,177 83 Less: Variable Cost Per Unit $7,300.00 Contribution Margin Per Unit $4,877 23 Total Fixed Cost $2,001,000.00 BEP Unit Sales BEP Dollar Sales $4,284,795 57 B. Contribution Margion Per Unit $4,877 83 Selling Price Per Unit $12,177 83 40.05%% C. Units to be sold to earn a profit of $1,000,000 Fixed Cost+Desired Profit / Contr. Margin Per Unit 615 2332238 615 Units Sales required to earn a profit of $1,000,000 Fixed Cost+ Desired Profit/Contr Margin Ratio $7,492 202 53 D. Margin of Safety Dollar = Sales at 2,000 level . BEP Sales Sales at 2,000 Units $24,355,650.00 BEP Sales $4,284,795 57 Margin of Safety dollar $20,070,853.43