Question
Personal Electronix sells computer tablets and MP3 players. The business is divided into two divisions along product lines. CVP income statements for a recent quarters
Personal Electronix sells computer tablets and MP3 players. The business is divided into two divisions along product lines. CVP income statements for a recent quarters activity are presented below.
| Tablet Division | MP3 Player Division | Total | ||||
|---|---|---|---|---|---|---|
| Sales | $748,800 | $421,200 | $1,170,000 | |||
| Variable costs | 546,624 | 231,660 | 778,284 | |||
| Contribution margin | $202,176 | $189,540 | 391,716 | |||
| Fixed costs | 135,594 | |||||
| Net income | $256,122 |
(a)
Determine sales mix percentage and contribution margin ratio for each division.
| Sales Mix Percentage | ||
|---|---|---|
| Tablet division | 64 % | |
| MP3 Player division | 36 % |
| Contribution Margin Ratio | ||
|---|---|---|
| Tablet division | 27 % | |
| MP3 Player division | 45 % |
(b)
Calculate the companys weighted-average contribution margin ratio. (Round computations and final answer to 2 decimal places, e.g. 15.26%.)
| Weighted-average contribution margin ratio | Enter the weighted-average contribution margin ratio in percentages rounded to 2 decimal places % |
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Managerial Accounting
Authors: Ray Garrison, Eric Noreen, Peter Brewer
16th edition
1259307417, 978-1260153132, 1260153134, 978-1259307416
