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Please ANSWER THE QUESTION RIGHT, MAY GOD BLESS YOU Break-Even in Units and Sales Dollars, Margin of Safety Aubrey Company produces a single product. Last
Please ANSWER THE QUESTION RIGHT, MAY GOD BLESS YOU
Break-Even in Units and Sales Dollars, Margin of Safety Aubrey Company produces a single product. Last year's income statement is as follows: Sales (23,000 units) $1,389,200 Less: Variable costs 924,600 Contribution margin $464,600 Less: Fixed costs 273,600 Operating income $191,000 Required: 1. Compute the break-even point in units and sales revenue. In your computations, round the contribution margin per unit to the nearest cent and round the contribution margin ratio to four decimal places. Round your final answers to the nearest whole unit or dollar. Break-even units X units Break-even dollars 2. What was the margin of safety in dollars for the Company last year? Round your final answer to the nearest whole dollar. Feedback Check My Work 1. Calculate unit contribution margin. Use that to determine break-even in units. Use break-even units and multiply by price per unit to determine break-even dollars. 2. The margin of safety in sales revenue is the revenue earned or expected to be earned above break-even in sales dollars. Check My Work Previous 3. Suppose that Aubrey Company is considering an investment in new technology that will increase fixed costs by $226,900 per year, but will lower variable costs to 50 percent of sales. Units sold will remain unchanged. Prepare a budgeted income statement assuming the company makes this investment. Round all amounts to the nearest dollar. Aubrey Company Budgeted Income Statement Sales Less: Variable costs Contribution margin $ Less: Fixed costs Operating income What is the new break-even point in units, assuming the investment is made? In your computations, round the unit contribution margin to the nearest cent. Round your final answer to the nearest whole unit. units
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