Question
Problem 11-28 Determining the break-even point and preparing a contribution margin income statement LO 11-5 Ritchie Manufacturing Company makes a product that it sells for
Problem 11-28 Determining the break-even point and preparing a contribution margin income statement LO 11-5
Ritchie Manufacturing Company makes a product that it sells for $200 per unit. The company incurs variable manufacturing costs of $101 per unit. Variable selling expenses are $19 per unit, annual fixed manufacturing costs are $464,000, and fixed selling and administrative costs are $256,000 per year.
Required
Determine the break-even point in units and dollars using each of the following approaches:
-
Use the equation method.
-
Use the contribution margin per unit approach.
-
Prepare a contribution margin income statement for the break-even sales volume.
Complete this question by entering your answers in the tabs below.
Determine the break-even point in units and dollars using the equation method, the contribution margin per unit approach and the contribution margin ratio approach.
| A. | Break-even point in units | |
| Break-even point in dollars | ||
| B. | Contribution margin per unit | |
| Break-even point in units | ||
| Break-even point in dollars |
- Req C
Prepare a contribution margin income statement for the break-even sales volume.
Richie Manufacturing Company
| Contribution Margin Income Statement | |
| Cost of goods sold | |
| Fixed costs | |
| Sales | |
| Selling expenses | |
| Variable costs | |
| Net Income or Net Loss |
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Accounting For Beginners Learn Easy And Fast Accounting Principles
Authors: Dan Wilson
1st Edition
1700199900, 978-1700199904
