Variable Costs, Contribution Margin, Contribution Margin Ratio

Super-Tees Company plans to sell 13,000 T-shirts at $15 each in the coming year. Product costs include:

Direct materials per T-shirt	$5.25
Direct labor per T-shirt	$1.05
Variable overhead per T-shirt	$0.45
Total fixed factory overhead	$41,000

Variable selling expense is the redemption of a coupon, which averages $0.75 per T-shirt; fixed selling and administrative expenses total $14,000.

Required:

1. Calculate the following values: Round dollar amounts to the nearest cent and round ratio values to three decimal places (express the ratio as a decimal rather than a percentage).

a. Variable product cost per unit	$
b. Total variable cost per unit	$
c. Contribution margin per unit	$
d. Contribution margin ratio
e. Total fixed expense for the year	$

2. Prepare a contribution-margin-based income statement for Super-Tees Company for the coming year. If required, round your per unit answers to the nearest cent.

Super-Tees Company
Contribution-Margin-Based Operating Income Statement
For the Coming Year
	Total	Per Unit
	$	$
	$	$
	$

3. What if the per unit selling expense increased from $0.75 to $1.65? Calculate new values for the following: Round dollar amounts to the nearest cent and round ratio values to four decimal places (express the ratio as a decimal rather than a percentage):

a. Variable product cost per unit	$
b. Total variable cost per unit	$
c. Contribution margin per unit	$
d. Contribution margin ratio
e. Total fixed expense for the year	$

Variable Costs, Contribution Margin, Contribution Margin Ratio Super-Tees Company plans to sell 13,000 T-shirts at $15 each in the coming year. Product costs include: Direct materials per T-shirt Direct labor per T-shirt Variable overhead per T-shirt Total fixed factory overhead $5.25 $1.05 $0.45 $41,000 Variable selling expense is the redemption of a coupon, which averages $0.75 per T-shirt; fixed selling and administrative expenses total $14,000. Required: 1. Calculate the following values: Round dollar amounts to the nearest cent and round ratio values to three decimal places (express the ratio as a decimal rather than a percentage). a. Variable product cost per unit b. Total variable cost per unit c. Contribution margin per unit d. Contribution margin ratio e. Total fixed expense for the year 2. Prepare a contribution-margin-based income statement for Super-Tees Company for the coming year. If required, round your per unit answers to the nearest cent. Super-Tees Company 2. Prepare a contribution-margin-based income statement for Super-Tees Company for the coming year. If required, round your per unit answers to the nearest cent. Super-Tees Company Contribution-Margin-Based Operating Income Statement For the Coming Year Total Per Unit 3. What if the per unit selling expense increased from $0.75 to $1.65? Calculate new values for the following: Round dollar amounts to the nearest cent and round ratio values to four decimal places (express the ratio as a decimal rather than a percentage): a. Variable product cost per unit b. Total variable cost per unit C. Contribution margin per unit d. Contribution margin ratio e. Total fixed expense for the year