Income Statement - Biblio Files

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Biblio Files Company

Contribution Margin Income Statement

For the Year Ended December 31

1

Sales

$424,000.00

2

Variable costs:

3

Manufacturing

$169,600.00

4

Selling

16,960.00

5

Administrative

67,840.00

254,400.00

6

Contribution margin

$169,600.00

7

Fixed costs:

8

Manufacturing

$88,000.00

9

Selling

8,000.00

10

Administrative

10,000.00

106,000.00

11

Income from operations

$63,600.00

Biblio Files Company is making plans for its next fiscal year, and decides to sell two new types of bookshelves, Basic and Deluxe. The company has compiled the following estimates for the new product offerings.

Type of Bookshelf	Sales Price per Unit	Variable Cost per Unit
Basic	$5.00	$1.75
You are in Column Type of BookshelfDeluxe	You are in Column Sales Price per Unit$9.00	You are in Column Variable Cost per Unit$8.10

The company is interested in determining how many of each type of bookshelf would have to be sold in order to break even. If we think of the Basic and Deluxe products as components of one overall enterprise product called Combined, the unit contribution margin for the Combined product would be $2.31. Fixed costs for the upcoming year are estimated at $346,962. Recall that the totals of all the sales mix

The relative distribution of sales among the various products available for sale.

percents must be 100%. Determine the amounts to complete the following table.

Type of Bookshelf	Percent of Sales Mix	Break-Even Sales in Units	Break-Even Sales in Dollars
Basic
Deluxe