Ramada Company produces one golf cart model. A partially complete table of company costs follows: 800 1,000 1,200 $ Number of golf carts produced and sold Total costs Variable costs Fixed costs per year Total costs Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit ? ? ? $400,000 240,000 640,000 ? ? ? ? ? ? ? ? ? ? ? ? Required: 1. Complete the table. 2. Ramada sells its carts for $1,000 each. Prepare a contribution margin income statement for each of the three production levels given in the table. 4. Calculate Ramada's break-even point in number of units and in sales revenue. 5. Assume Ramada sold 450 carts last year. Without performing any calculations, determine whether Ramada earned a profit last year. 6. Calculate the number of carts that Ramada must sell to earn $60,000 profit. 7. Calculate Ramada's degree of operating leverage if it sells 1,050 carts. 8. Using the degree of operating leverage, calculate the change in Ramada's profit if sales are 10 percent less than expected. Required 1 Required 2 Required 4 Required 5 Required 6 Required 7 Required 8 Complete the table. (Round your "Cost per Unit" answers to 2 decimal places.) Number of Golf Carts Produced and Sold 800 Units 1,000 Units 1,200 Units Total costs Variable costs $ Fixed costs per year 400,000 240,000 640,000 $ Total costs $ 0 $ 0 Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit $ 0.00 $ 0.00 $ 0.00 Required 1 Required 2 Required 1 Required 2 Required 4 Required 5 Required 6 Required 7 Required 8 Ramada sells its carts for $1,000 each. Prepare a contribution margin income statement for each of the three production levels given in the table. Golf Carts Produced and Sold 800 units 1,000 units 1,200 units Contribution Margin Income from Operations Required 1 Required 4 Required 1 Required 2 Required 4 Required 5 Required 6 Required 7 Required 8 Calculate Ramada's break-even point in number of units and in sales revenue. (Round your "Unit" and "Sales Revenue" answers to the nearest whole number.) Break-Even Units Carts Break-Even Sales Revenue Required 1 Required 2 Required 4 Required 5 Required 6 Required 7 Required 8 Calculate the number of carts that Ramada must sell to earn $60,000 profit. Target Unit Sales Carts Required 1 Required 2 Required 4 Required 5 Required 6 Required 7 Required 8 Calculate Ramada's degree of operating leverage if it sells 1,050 carts. (Round your answer to 4 decimal places.) Degree of Operating Leverage Using the degree of operating leverage, calculate the change in Ramada's profit if sales are 10 percent less than expected. (Round your answer to 3 decimal places. (i.e. .12345 should be entered as 12.345%.)) Effect on Profit % Required 7 Required 8
