Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

PA6-1 (Algo) Calculating Contribution Margin, Contribution Margin Ratio, Break-Even Point [LO 6-1, 6-2] Hermosa, Inc., produces one model of mountain bike. Partial information for the

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
PA6-1 (Algo) Calculating Contribution Margin, Contribution Margin Ratio, Break-Even Point [LO 6-1, 6-2] Hermosa, Inc., produces one model of mountain bike. Partial information for the company follows: 500 770 930 $120,500 $ $ 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 ? 7 2 2 2 2 ? 2 2 7 ? ? $530.75 ? ? ? Required: 1. Complete the table. 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 $710. 4. Calculate Hermosa's break-even point in units and sales revenue. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 4 Required: 1. Complete the table, 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 $710. 4. Calculate Hermosa's break-even point in units and sales revenue. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 4 5 Complete the table. (Round your "Cost per Unit" answers to 2 decimal places.) Number of bikes produced and sold 500 units 770 Units 930 Units Total costs Variable costs $ 120,500 Fixed costs per year Total costs $ 120,500 $ 0 $ 0 Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit 0.00 530.75 $ 0.00 $ $ Required 2 > Required 1 Required 2 Required 4 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 $710. (Round your percentage answers to 2 decimal places. (l.e. .1234 should be entered as 12.34%. 500 Units 770 Units 930 Units % % Contribution Margin Ratio Total Contribution Margin Required 1 Required 2 Required 4 Calculate Hermosa's break-even point in units and sales revenue. (Round your "Unit" and "Sales Revenue" answers to the nearest whole number) Bikes Break-Even Units Break-Even Sales Revenue

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Integrated Audit Practice Case

Authors: David S. Kerr, Randal J. Elder, Alvin A. Arena

6th Edition

0912503564, 9780912503561

More Books

Students also viewed these Accounting questions

Question

6. Describe why communication is vital to everyone

Answered: 1 week ago