(Wallace)

Bell Industries sells samsung phones for CDN$100. The unit variable cost per phone is $50 plus a selling commission of 10%. Fixed manufacturing costs total $1,250 per month, while fixed selling and administrative costs total $2,500. A. What is the contribution margin per phone? Selling Price - $100.00 Variable Cost = CAD$50 + 10%($100) Total Variable Cost = $50+10 Total Variable Cost = $60.00 Contribution Margin = Selling price - Variable Cost = $100-60 = $40 B. What is the break even point ? BEP = TFC /Unit Contribution = 2500+1250 /40 = 94 ( Rounded off to nearest whole #) C. How much phone must be sold for us to meet a target $7500? Sales ( Unit) = TNI+TFC/Contribution Margin = $3750+$7500/40 = $11250/40 = 281 phones

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