Question
Blanchard Company manufactures a single product that sells for $160 per unit and whose total variable costs are $120 per unit. The companys annual fixed
Blanchard Company manufactures a single product that sells for $160 per unit and whose total variable costs are $120 per unit. The companys annual fixed costs are $596,000.
(1) Prepare a contribution margin income statement for Blanchard Company at the break-even point.
| BLANCHARD COMPANY | ||||
| Contribution Margin Income Statement (at Break-Even) | ||||
| Amount | Percentage of sales | |||
| Sales Variable costs Contribution margin Fixed costs Net income | ||||
| Sales Variable costs Contribution margin Fixed costs Net income | ||||
| Sales Variable costs Contribution margin Fixed costs Net income | ||||
| Sales Variable costs Contribution margin Fixed costs Net income | ||||
| Sales Variable costs Contribution margin Fixed costs Net income | ||||
(2) Assume the companys fixed costs increase by $134,000. What amount of sales (in dollars) is needed to break even?
| Break-Even Point in Dollars | ||||||||
| Choose Numerator: | / | Choose Denominator: | = | Break-Even Point in Dollars | ||||
| Contribution margin ratio Fixed costs per unit Selling price per unit Total fixed costs Variable costs per unit | / | Contribution margin ratio Fixed costs per unit Selling price per unit Total fixed costs Variable costs per unit | = | Break-even point in dollars | ||||
| % | ||||||||
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started