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The contribution margin income statement of Bountiful Bean Coffee for March follows: (Click the icon to view the contribution margin income statement.) Bountiful Bean Coffee
The contribution margin income statement of Bountiful Bean Coffee for March follows: (Click the icon to view the contribution margin income statement.) Bountiful Bean Coffee sells three small coffees for every large coffee. A small coffee sells for $2.00, with a variable expense of S1.0 A large coffee sells for $4.00, with a variable expense of $2.00 0. Requirements 1. Determine Bountiful Bean Coffee's monthly breakeven point in the numbers of small coffees and large coffees. Prove your answer by preparing a summary contribution margin income statement at the breakeven level of sales. Show only two categories of expenses: variable and fixed. 2. Compute Bountiful Bean Coffee's margin of safety in dollars. 3. Use Bountiful Bean Coffee's operating leverage factor to dete its new operating income if sales volume increases 12%. Prove your results using the contribution margin income statement format. Assume the sales mix remains unchanged Requirement 1. Determine Bountiful Bean Coffee's monthly breakeven point in numbers of small coffees and large coffees. Prove your answer by preparing a summary contribution margin income statement at the breakeven level of sales. Show only two categories of expenses: variable and fixed. Begin by identifying the formula to compute the total breakeven point in units. (Abbreviations used: avg. Average; CM Contribution margin Breakeven sales in units Now calculate the weighted-average contribution margin per unit. (Round the weighted-average contribution margin per unit to the nearest cent Small Large Total Less Weighted average contribution margin per unit The breakeven point is small cups and large cups of coffee Prepare a summary contribution margin income statement to prove your answer above. (For amounts with a so balance, make sure to enter "0" in the appropriate cel Smal Large Total Less Less Operating income
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