Group Assignment on Cost and Management II 1. What is cost-volume-profit analysis and when is it particularly useful? 2. Identify the important assumptions that underline cost-volume-profit analysis. 3. What is the contribution margin ratio and when is it most useful? 4. When is it most reasonable to use a single independent variable in cost-volume-profit analysis? 5. What is the unit contribution margin? How is it used in computing the unit break-even point? 6. What is the contribution margin ratio and when is it most useful? 7. How is the determination of the break-even point affected by incorporating a desired profit? 8. What impact do income taxes have on the sales volume required to earn a desired after-tax profit? 9. What is the distinguishing feature of a multi-level contribution income statement? Part II workout Core Company accumulates the following data concerning a mixed cost, using units produced as the activity level. Case 1 Case 2 Case 3 Case 4 Unit sales 1,000 800 ? ? Sales revenue $20,000 ? ? $60,000 Variable cost per unit $10 $1 $12 ? Contribution margin . ? $800 ? ? Fixed costs ... $8,000 ? $80,000 ? Net income ? $400 ? ? Unit contribution margin Break-even point (units) Margin of safety (units) ? ? ? $15 ? ? 4,000 2,000 ? 300 1,000