Question
Joys Classy Pet Products sells a deluxe pet bed for $150 per unit. The companys variable cost per unit is $40 for direct material, $20
Joys Classy Pet Products sells a deluxe pet bed for $150 per unit.
The companys variable cost per unit is $40 for direct material, $20 per unit for direct labor, and $15 per unit for overhead.
Annual fixed production overhead is $35,000 and fixed selling and administration overhead is $27,500.
- What is the contribution margin per unit? (The CM per unit will be 75 Show your work.)
- What is the contribution margin ratio?
- What is the break-even point in units?
- Using the contribution margin ratio, what is the break-even point in sales dollars?
- If Joys Class Pet Products wants to earn a pre-tax profit of $52,070, how many units must the company sell?
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Cornerstones of Managerial Accounting
Authors: Mowen, Hansen, Heitger
3rd Edition
978-0324660135
