Waldo Company produces one product. The following are the data for the current month: Selling price per
Question:
Waldo Company produces one product. The following are the data for the current month:
Selling price per unit ................................................$80
Variable cost per unit
Direct materials ....................................................... $21
Direct labor ........................................................... 10
Variable manufacturing overhead ................................ 3
Variable selling and administrative (per unit sold)............. 6
Fixed costs
Manufacturing overhead.......................................... $76,000
Selling and administrative ....................................... 58,000
Units
Beginning inventory ....................................... 0
Month's production ....................................... 5,000
Number sold ....................................... 4,500
Ending inventory ............................................... 500
The contribution margin is
a. $180,000
b. 226000
c. 46000
d. 207000
Contribution MarginContribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes... Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...
Step by Step Answer:
Answer A is correct The contribution margin equals sales revenue minus all variable costs ...View the full answer
Cost Accounting A Managerial Emphasis
ISBN: 978-0133392883
6th Canadian edition
Authors: Horngren, Srikant Datar, George Foster, Madhav Rajan, Christ
