FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
ABC Corporation sells its product for $195.70 per unit. In 2015 the company had total sales in units of 6,000. The total costs were the following:
Variable cost of sales $457,800
Fixed cost of sales 100,000
Variable selling & administrative costs 108,500
Fixed selling & administrative costs 512,400
What is the best estimate of the total contribution margin?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by stepSolved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Thornton Manufacturing Company reported the following data regarding a product it manufactures and sells. The sales price is $44. 12 Variable costs Manufacturing Selling Fixed costs Manufacturing Selling and administrative 17 per unit 6 per unit $152,000 per year $102,100 per year Required a. Use the per-unit contribution margin approach to determine the break-even point in units and dollars. b. Use the per-unit contribution margin approach to determine the level of sales in units and dollars required to obtain a profit of $178,500. c. Suppose that variable selling costs could be eliminated by employing a salaried sales force. If the company could sell 21,400 units, how much could it pay in salaries for salespeople and still have a profit of $178,500? (Hint Use the equation method.) a. Break-even point in units Break-even point in dollars b Required sales in units Required sales in dollars C Fixed cost of salariesarrow_forwardZhao Company has fixed costs of $455,600. Its single product sells for $191 per unit, and variable costs are $124 per unit. If the company expects sales of 10,000 units, compute its margin of safety (a) in dollars and (b) as a percent of expected sales. $ a. Margin of safety (in dollar) 611,200 b. Margin of safety (%)arrow_forwardSunn Company manufactures a single product that sells for $210 per unit and whose variable costs are $168 per unit. The company's annual fixed costs are $575,400. (a) Compute the company's contribution margin per unit. Contribution margin (b) Compute the company's contribution margin ratio. 1 Numerator: (c) Compute the company's break-even point in units. 1 1 Numerator: Denominator: Numerator: Denominator: (d) Compute the company's break-even point in dollars of sales. 1 1 Denominator: II Contribution Margin Ratio Contribution margin ratio Break-Even Units Break-even units 0 Break-Even Dollars Break-even dollars 4arrow_forward
- jagdisharrow_forwardLablanc Inc. sells a product for $93 per unit. The variable cost is $45 per unit, while fixed costs are $516,096. Determine (a) the break-even point in sales units and (b) the break-even point if the selling price were increased to $101 per unit.arrow_forwardFor 2013, Harper Company sold 86,000 units at a selling price of $23 per unit. Variable cost per unit was $15, and Harper's net income for the year was $46,000. What was the amount of Harper's fixed costs? Multiple Choice $1,932,000 $642,000 $688,000 $1,058,000arrow_forward
- Harry Company sells 15,000 units at $44 per unit. Variable costs are $30.36 per unit, and fixed costs are $63,400. Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) income from operations.arrow_forwardYusuf Company sells a product for $220 per unit. The variable cost is $170 per unit, and fixed costs are $180,000. Determine (a) the break-even point in sales units and (b) the sales units required to achieve a target profit of $56,000.arrow_forwardSimmons Corp. has a selling price of $11, variable costs of $2 per unit, and fixed costs of $24,852. Simmons net income is $44,370. How many units did Simmons sell? Round your units to nearest whole numberarrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
- AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
- Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSONIntermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill EducationFinancial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education