Question
Contribution margin, gross margin, and margin of safety. Mirabel Cosmetics manufactures and sell s a face cream to small family-run stores in the greater Montreal
Contribution margin, gross margin, and margin of safety. Mirabel Cosmetics manufactures and sell s a face cream to small family-run stores in the greater Montreal area. It presents the monthly operating statement of comprehensive income shown here to Fran~ois Laval, a potential investor in the business. Help Laval understand Mirabel's cost structure. Mirabel Cosmetics Statement of Operating Income for the Month of June Units sold 10,000 Revenue $100,000 Cost of goods sold Variable manufacturing costs Fixed manufacturing costs Total Gross margin Operating costs Variable marketing costs Fixed marketing and administration costs Total operating costs Operating income $55,000 20,000 75,000 25,000 5,000 10,000 15,000 $ 10,000 .... L03 Net Fixed Costs = $51,000 .... L03 1. a. 489 tickets .... L02 2. CM%, 40% 84 e CHAPTER 3 COST-VOLUME-PROFIT ANALYSIS L02 ... 1. a. Operating income, $120,000 L04 ... 1. llfeakeven = 12 children L04 ... 1. Breakeveo = 39 carpels Required 1. Recast the statement of operating income in a contribution format. 2. Calculate the contribution margin percentage and breakeven point in units and revenues for June. 3. What is the margin of safety (in units} for June? 4. If sales in June were only 8,000 units and Mirabel's tax rate is 30%, calculate its net income.
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