Q2 Q1 2-1 Define cost object and give three examples. 2-6 What is a cost driver? Give one example. Q3 3-36 Roma Skincare manufactures and sells face cream to small specialty stores in Victoria, Australia. It presents the monthly operating income statement shown here to Jacob Scott, a potential investor in the business. Help Mr. Scott understand Roma Skincare's cost structure. View D 15.000 $1.20.000 Roma Skincare 2 Operating Income Statement June, 2017 3 Units sold Revenues 5 Cost of goods sold 6 Variable manufacturing costs $60.000 7 Ford mandaluring costs 22.000 8 Total cost of goods sold Gros margin 10. Operating costs Variable marketing costs $6.000 12 Faxed marketing & Admin costs $14.000 12 Total operating costs 4 Operating income S2000 $ 38000 $20.000 StR 600 Required 1. Recast the income statement to emphasize contribution margin. 2. Calculate the contribution margin percentage and breakeven point in units and revenues for June 2017. 3. What is the margin of safety (in units) for June 2017? 4. If sales in June were only 12,000 units and Roma Skincare's tax rate is 30%, calculate its net income. Q4 7-21 Flexible budget. Brabham Enterprises manufactures tires for the Formula 1 motor racing circuit. For August 2017, it budgeted to manufacture and sell 3,000 tires at a variable cost of $74 per tire and total fixed costs of $54,000. The budgeted selling price was $110 per tire. Actual results in August 2017 were 2,800 tires manufactured and sold at a selling price of $112 per tire. The actual total variable costs were $229,600, and the actual total fixed costs were $50,000. 1. Prepare a performance report (akin to Exhibit 7-2, page 274) that uses a flexible budget and a static budget. 2. Comment on the results in requirement 1