Question
Profitability Analysis Assume a local Cost Cutters provides cuts, perms, and hairstyling services. Annual fixed costs are $120,000, and variable costs are 40 percent of
- Profitability Analysis Assume a local Cost Cutters provides cuts, perms, and hairstyling services. Annual fixed costs are $120,000, and variable costs are 40 percent of sales revenue. Last year's revenues totaled $250,000. (a) Determine its break-even point in sales dollars. $ Answer (b) Determine last year's margin of safety in sales dollars. $ Answer (c) Determine the sales volume required for an annual profit of $80,000.
- Multiple Product Break-Even Analysis Presented is information for Stafford Company's three products.
A | B | C | |
Unit selling price | $7 | $9 | $7 |
Unit variable costs | (4) | (5) | (1) |
Unit contribution margin | $3 | $4 | $6 |
With monthly fixed costs of $306,000, the company sells two units of A for each unit of B and three units of B for each unit of C. Determine the unit sales of product A at the monthly break-even point. Answer units
- Kopi Company produces dog cages that are sold for $45 per unit. The company produced and sold 5,000 dog cages during July 2017. There were no beginning or ending inventories. Variable and fixed costs follow.
Variable Costs per Unit | Fixed Costs per Month |
| |||||||
Manufacturing: | Manufacturing overhead | $42,000 | |||||||
Direct materials | $10 | Selling and administrative | 18,000 | ||||||
Direct labor | 2 | Total | $60,000 | ||||||
Manufacturing overhead | 5 | $17 | |||||||
Selling and administrative | 5 | ||||||||
Total | $22 | ||||||||
Required Prepare a contribution income statement for July.
Do not use any negative signs with your answers.
Kopi Company | ||
Contribution Income Statement | ||
For the Month of July 2017 | ||
Sales | Answer | |
Less variable costs | ||
Direct materials | Answer | |
Direct labor | Answer | |
Manufacturing overhead | Answer | |
Selling and administrative | Answer | Answer |
Contribution margin | Answer | |
Less fixed cost: | ||
Manufacturing overhead | Answer | |
Selling and administrative | Answer | Answer |
Profit | Answer |
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