Question
Just Organic Juices sells bottles of freshly squeezed organic juice to small boutique shops throughout Melbourne. Its latest income statement for the last 12 months
Just Organic Juices sells bottles of freshly squeezed organic juice to small boutique shops throughout Melbourne. Its latest income statement for the last 12 months is as follows:
Time le
Just Organic Juices
Income Statement
Sales (155 000 bottles@ $5)
775 000
Cost of goods sold (155 000 bottles
542 500
@$3.50)*
Gross Profit
232,500
Less: Other expenses
Advertising
10.000
Manager's salary
65 000
Occupancy and administration
20 000
95 000#
Net Profit
137 500
variable costs
# fixed costs
Required:
(a) Calculate the contribution margin per juice bottle
(b) Calculate the number of juice bottles to break even in both units and sales dollars
(c)
The company expects to make a net profit of $180 000 in the coming year
How many units will be sold at this level of activity?
What will the sales in dollars be at this level of activity? What will the gross profit be at this level of activity?
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