Question
Morning Dove Company manufactures one model of birdbath, which is very popular. Morning Dove sells all units it produces each month. The relevant range is
Morning Dove Company manufactures one model of birdbath, which is very popular. Morning Dove sells all units it produces each month. The relevant range is 02,400 units, and monthly production costs for the production of 2,000 units follow. Morning Doves utilities and maintenance costs are mixed with the fixed components shown in parentheses. Production Costs Total Cost Direct materials $ 2,700 Direct labor 6,700 Utilities ($130 fixed) 620 Supervisors salary 2,900 Maintenance ($310 fixed) 460 Depreciation 800 Suppose it sells each birdbath for $24.
Required: 1. Calculate the unit contribution margin and contribution margin ratio for each birdbath sold. (Round Variable cost per unit to 2 decimal places. Enter all amounts as positive values.)
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2. Complete the contribution margin income statement assuming that Morning Dove produces and sells 2,200 units. with discription (Round your intermediate calculation to two decimal place.)
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