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ulating breakeven point for two products, margin of safety, and Calculan verage Cost-Volume-Profit A operating leverage tion margin income statement of Krazy Kustard Donuts for
ulating breakeven point for two products, margin of safety, and Calculan verage Cost-Volume-Profit A operating leverage tion margin income statement of Krazy Kustard Donuts for August 2016 Learning Object The contribution ows: 2. 12,000 dz. & 3,0 KRAZY KUSTARD DONUTS Contribution Margin Income Statement Month Ended August 31, 2016 Sales Revenue Variable Costs: 125,000 Cost of Goods Sold Selling Costs Administrative Costs $32,100 17.100 800 50,000 Contribution Margin Fixed Costs: 75,000 Selling Costs Administrative Costs 32,400 10,800 43,200 Operating Income $ 31,800 Krazy Kustard sells four dozen plain donuts for every dozen custard-Filled donuts. A dozen plain donuts sells for $4.00, with total variable cost of $1.60 per dozen. A dozen custard-filled donuts sells for $8.00, with total variable cost of $3.20 per dozen. Requirements I. Calculate the weighted-average contribution margin. 2 Determine Krazy Kustard's monthly breakeven point in dozens of plain donuts and custard-filled donuts. Prove your answer by preparing a summary contribution n income statement at the breakeven level of sales. Show only two categories of costs: variable and fixed. mpute the degree of operating leverage for Krazy Kustard Donuts. Estimate the new operating income if total sales increase by 40%. (Round the degree of operating leverage to four decimal places and the final answer to the nearest dollar Asume the sales mix remains unchanged.) S. Compute Krazy Kustard's margin of safery in dollars for August 2016 5. Prove in total sales. (The sales mix remains nyour answer to Requirement 4 by preparing a contribution margin ith a 40% increase
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