Guiller Company's projected profit for the coming year followsPER UNITP 20.0012.00P 8.00TOTALSalesVariable costsContribution marginP2,480,0001,488.000992,000626.400P 365,600Fixed costOperating income Compute the contribution margin ratioLUsing the projected sales for the coming year, compute the margin of safety and -margin of safety ratio.

Contribution margin ratio It is calculated by substraction of variable cost from total sales and…

Answered: Compute the contribution margin Using…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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If a company increases its fixed cost for product B, then the contribution margin per unit will Increase Decrease Remain the same More information is needed
The ratio of contribution margin in dollars to the selling price is the: Select one: O profit margin. O break-even point in unit sales. O contribution margin ratio. O net income
please solve with full work
Exercise 3-27 (Algo) Basic Decision Analysis Using CVP (LO 3-1) Belleterre Tiles makes tiles for flooring and other applications. The CFO of the company provides you with the following information for the period October through December, the company's third quarter: Belleterre Tile Revenues and Costs Third Quarter Total quantity sold Total revenues Total variable costs Total fixed costs 126,600 tiles $ 483,612 368,406 109, 200 Required: a. What is the average selling price per tile? Note: Round your final answer to 2 decimal places. b. What is the average variable cost per tile? Note: Round your final answer to 2 decimal places. c. What is the average contribution margin per tile? Note: Do not round intermediate calculations. Round your final answer to 2 decimal places. d. What is the current operating profit for a quarter? Note: Do not round intermediate calculations. e. What is the break-even point? Note: Do not round intermediate calculations. f. The CFO tells you that the company…
Compute breakeven sales. (Use the rounded contribution margin ratio calculated in the previous part to compute breakeven sales.) Breakeven sales eTextbook and Media Save for Later (b2) S What is Pharoah's margin of safety? Margin of safety $
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How many statements below regarding margin of safety are correct? 1. It is the amount by which sales can be reduced without incurring a loss. 2. It is the difference between budgeted sales and breakeven sales. 3. It can be expressed in terms of unit, pesos or percentage of sales. 4. Its presence indicates that the company expects profit. 5. The product of margin of safety units and unit contribution margin is the projected profit for the period. 6. The higher the margin of safety, the lower is the risk of incurring operating loss. 3 4
Reviewing cost behaviour patterns over time from the accounting records and using that review to predict future costs best describes: O Regression analysis O Scatter plots O Analysis at the account level O Two-point methods
The contribution margin ratio always increases when (you may select more thanone answer):a. Sales increase.b. Fixed costs decrease.c. Total variable costs decrease.d. Variable costs as a percent of sales decrease
Define the term Annual operating cost:?
APPLY THE CONCEPTS: Margin of Safety Margin of safety can allow you to see how much padding there is for your company between profit and loss. If this number is great, it may indicate that your company is performing very well. If this number is small, it may be worth looking into possible remediation. Consider the following pricing and cost information: Price and Cost Information Amount Selling Price per Unit $450 Variable Cost per Unit $400 Total Fixed Cost $70,000 For the upcoming period, the company projects that it will sell 2,000 units. Considering that the company has a unit break-even point of 1,400 units, what is the margin of safety in terms of both units and sales revenue? Round your answers to two decimal places, if necessary. Margin of Safety in Units Margin of Safety in Sales Revenue = $
What is the margin of safety in dollars? What is the margin of safety percentage?

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Compute the contribution margin Using the projected sales for the coming year, compute the margin of safety and - margin of safety ratio.