Answer to number 3 & 4
2. What is the expected contribution margin ratio? Round to the nearest whole percent. 50 % 3. Determine the break-even sales in units and dollars. Units 2,520 units Dollars 211,680 X units 4. Construct a cost-volume-profit chart on your own paper. What is the break-even sales? 423,360 5. What is the expected margin of safety in dollars and as a percentage of sales? Dollars: 705,600 63 % Percentage: (Round to the nearest whole percent.) 6. Determine the operating leverage. Round to one decimal place. 0.6 x Belmain Coexpects to maintain the same inventaries at the end of 2017 as at the beginning of the year. The total of all production costs for the year is therefore assumed to be equal to the cost of goods sold with this in mind, the various department heads were asked to submit estimates of the costs for their departments during the year. A Summary report of these estimates is as follows: Estimated Variable Cost Estimated (per Fixed unit Cost sold) 20 D 13.00 2200 100 2.100 2.300 27.500 2 It is expected that 6,720 units will be sold at a price of $168 a unit. Maximum sales within the relevant range are 8,000 units. Required: 1. Prepare an estimated Income statement for 2017. Belmain Co. Estimated Income Statement For the Year Ended December 31, 2017 Sales 1.12 201.400 Cost of goods sold: Direct materials Direct labor Factory overhead 16400 -572.300 Cost of goods sold Gross profit Expenses Seing expenses Sales salaries and commissions Advertising Travel Miscellaneous selling expense 1.17 7430 TO Tot ngepenses mwen Office and officers salaries 27.500 Administrative expenses Office and officers' salaries Supplies Miscellaneous administrative expense v Total administrative expenses I 21.5 23.300 74,400 7 Total expenses -203.860 Income from operations 352.800 Belmain Co. expects to maintain the same inventaries at the end of 2017 at the beginning of the year. The total of all production costs for the year in therefore assumed to be equal to the cost goods sold with this in mind, the various department heads were asked to submit estimates of the costs for their departments during the year. A summary report of these estimates is as follows Estimated Variable Cost Estimated (per Fixed unt Cost sold) Production costs Direct material 330 Direct labor Factory overhead $135,500 15 Selling exte Ses sales and commissione 2 Advertising 9.500 Travel 2,100 Miscellaneous selling expense 2.300 6 Administrative expenses omice and officers salaries 27.500 28.200 Cost (per Estimated Fixed Cost unit sold) $30 20 $135,500 15 28,200 Production costs: Direct materials Direct labor Factory overhead Selling expenses: Sales salaries and commissions Advertising Travel Miscellaneous selling expense Administrative expenses: Office and officers' salaries Supplies Miscellaneous administrative expense 9,500 2,100 2,300 27,500 3,400 3,180 3 3 Total $211,680 $84 It is expected that 6,720 units will be sold at a price of $168 a unit. Maximum sales within the relevant rango are 8,000 units
