Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The contribution margin format of the income statement is used by managers in order to evaluate new revenue or cost savings proposals. How to use
The contribution margin format of the income statement is used by managers in order to evaluate new revenue or cost savings proposals. How to use the data from the contribution margin I/S is the subject of this week. This topic is also called Cost-Volume-Profit (CVP) analysis TOPIC GROUP #3 - POSTED THURSDAY (A) Company B, who produces and sells a single product, has provided its contribution format income statement for November Sales (8,000 units) $440,000 Variable expensos 280,000 Contribution margin 160,000 Fixed expenses I 103,500 Not operating incomo$56,500 If the company sells 7,900 units, its not operating income should be? (B) Company C uses the following data in its Cost-Volume-Profit analyses What is total contribution margin if sales volume increases by 30% Total Sales $400,000 Variable expenses 220,000 Contribution margin 180,000 Fixed expenses 120,000 Net operating income $60,000 (C) Company D Inc sells a particular textbook $40. Variable expenses are $29 per book. At the current volume of 58,000 books sold per year the company is just breaking even. Given these data, how much are the annual fixed expenses associated with the textbook? (D) A Corporation has sales of 1,000 units at $50 per unit. Variable expenses are 40% of the selling price. If total fixed expenses are $20,000, how much is the degree of operating leverage
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started