Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Hermosa, Inc., produces one model of mountain bike. Partial information for the company follows: 500 800 970 $ $ Number of bikes produced and sold
Hermosa, Inc., produces one model of mountain bike. Partial information for the company follows: 500 800 970 $ $ Number of bikes produced and sold Total costs Variable costs Fixed costs per year Total costs Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit $ 117,000 ? ? ? ? ? ? ? ? ? ? ? ? ? ? ? $ 516.75 Required: 1. Complete the table. (Round your "Cost per Unit" answers to 2 decimal places.) Number of bikes produced and sold 500 Units 800 Units 970 Units Total costs Variable costs $ 117,000 Fixed costs per year Total costs Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit $ 516.75 2. Calculate Hermosa's contribution margin ratio and its total contribution margin at each sales level indicated in the table assuming the company sells each bike for $770. (Round your percentage answers to 2 decimal places. (i.e..1234 should be entered as 12.34%.)) 500 Units 800 Units 970 Units % % % Contribution Margin Ratio Total Contribution Margin 4. Calculate Hermosa's break-even point in units and sales revenue. (Round your answers to the nearest whole number.) Break-Even Units Bikes Break-Even Sales Revenue
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored 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