Required: 1. Complete the table. 2. Ramada sells its carts for $1,450 each. Prepare a contribution margin income statement for each of the three production levels given in the table. 4. Calculate Ramada's break-even point in number of units and in sales revenue. 5. Assume Ramada sold 300 carts last year. Without performing any calculations, determine whether Ramada earned a prof last year. 6. Calculate the number of carts that Ramada must sell to earn $21,000 profit. 7. Calculate Ramada's degree of operating leverage if it sells 850 carts. 8. Using the degree of operating leverage, calculate the change in Ramada's prbfit if sales are 15 percent less than expected ed ok Complete this question by entering your answers in the tabs below. nt Required 1 Required 2 Required 4 Required 5 Required 6 Required 7 Required 8 rences Complete the table. (Round your "Cost per Unit" answers to 2 decimal places.) Number of Golf Carts Produced and Sold 600 Units 800 Units 1,000 Units Total costs Variable costs 2$ 464,000 Fixed costs per year 240,000 Total costs $ 704,000 Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit

Required: 1. Complete the table. 2. Ramada sells its carts for $1,450 each. Prepare a contribution margin income statement for each of the three production levels given in the table. 4. Calculate Ramada's break-even point in number of units and in sales revenue. 5. Assume Ramada sold 300 carts last year. Without performing any calculations, determine whether Ramada earned a prof last year. 6. Calculate the number of carts that Ramada must sell to earn $21,000 profit. 7. Calculate Ramada's degree of operating leverage if it sells 850 carts. 8. Using the degree of operating leverage, calculate the change in Ramada's prbfit if sales are 15 percent less than expected ed ok Complete this question by entering your answers in the tabs below. nt Required 1 Required 2 Required 4 Required 5 Required 6 Required 7 Required 8 rences Complete the table. (Round your "Cost per Unit" answers to 2 decimal places.) Number of Golf Carts Produced and Sold 600 Units 800 Units 1,000 Units Total costs Variable costs 2$ 464,000 Fixed costs per year 240,000 Total costs $ 704,000 Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 35P

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Olongapo Sports Corporation distributes two premium golf balls—the Flight Dynamic and the Sure Shot. Monthly sales and the contribution margin ratios for the two products follow: picture1 Fixed expenses total $183,750 per month. Required:1. Prepare a contribution format income statement for the company as a whole. Carry computations to one decimal place.2. Compute the break-even point for the company based on the current sales mix.3. If sales increase by $100,000 a month, by how much would you expect net operating incometo increase? What are your assumptions?
Vandenberg Inc., produces and sells two products; a celling fan and a table fan.Vandenberg plans to sell 30,000 ceiling fans and 70,000 table fans in the coming year.Product price and cost information includes; Common fixed selling and ad,inistrative expenses total $85,000. Required: 1. What is the sales mix estimated for the next year (calculated to the lowest whole number for each product)? 2. Using the sales mix from Requirement 1, form a package of ceiling fans and table fans.How many ceiling fans and table fans are sold at break-even? 3. Prepare a contribution-margin based income statement for Vandenberg,Inc.,based on the unit sales calculated in Requirement 2. 4. What if Vandenberg,Inc.,wanted to earn operating income equal to $14,000? calculate the number of ceiling fans and table fans that must be sold to earn this level of operating income.(hint;Remeber to form a package of ceiling fans and table fans based on the sales mix and to first calculate the number of packages to…
3) Popular Inc. produces and sells two products. During the most recent month, Pen's sales were $24,000 and its variable expenses were $7,920. Pencil's sales were $41,000 and its variable expenses were $14,180. The company's fixed expenses were $40,350. Required: a. Prepare a contribution format income statement for the business. b. Determine the overall break-even point for the company in total sales dollars. c. Verify your answer of requirement b by constructing a contribution income statement.