Managerial Accounting: Tools for Business Decision Making
7th Edition
ISBN: 9781118334331
Author: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Publisher: WILEY
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 6, Problem 6.2E
In the month of June, Jose Hebert’s Beauty Salon gave 4,000 haircuts, shampoos, and permanents at an average price of $30. During the month, fixed costs were $16,800 and variable costs were 75% of sales.
Instructions
(a) Determine the contribution margin in dollars, per unit and as a ratio.
(b) Using the contribution margin technique, compute the break-even point in dollars and in units.
(c) Compute the margin of safety in dollars and as a ratio.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
In the month of June, Jose Hebert's Beauty Salon gave 4,200 haircuts, shampoos, and permanents at an average price of $40. During
the month, fixed costs were $16,700 and variable costs were 75% of sales.
Your answer is partially correct.
Determine the contribution margin in dollars, per unit and as a ratio. (Round contribution margin per unit and contribution margin
ratio to 2 decimal places, e.g. 5.25 & 10.50.)
Contribution margin
%$4
41750.00
Contribution margin per unit
24
10.00
25
Contribution margin ratio
In the month of June, Al Jamil Beauty Salon gave 5,400 haircuts, shampoos, and permanents at an average price of $ 30. During the month, fixed costs were $ 36,000 and variable costs were 70% of sales.
Instructions
(a) Determine the contribution margin in dollars per unit, and as a ratio.
(b) Using the contribution margin technique, compute the break-even point in dollars and in units.
(c) Compute the margin of safety in dollars and as a ratio
In the month of June, Jose Hebert’s Beauty Salon gave 3,500 haircuts, shampoos, and permanents at an average price of $30. During the month, fixed costs were $16,500 and variable costs were 75% of sales.
Determine the contribution margin in dollars, per unit and as a ratio. (Round contribution margin per unit and contribution margin ratio to 2 decimal places, e.g. 5.25 & 10.50.)
Contribution margin
$
Contribution margin per unit
$
Contribution margin ratio
%
Using the contribution margin technique, compute the break-even point in dollars and in units. (Round answers to 0 decimal places, e.g. 1,225.)
Break-even point
$
Break-even point
units
Compute the margin of safety in dollars and as a ratio. (Round answers to 0 decimal places, e.g. 1,225.)
Margin of safety
$
Margin of safety ratio
%
Chapter 6 Solutions
Managerial Accounting: Tools for Business Decision Making
Ch. 6 - What is meant by CVP analysis?Ch. 6 - Provide three examples of management decisions...Ch. 6 - Prob. 3QCh. 6 - Describe the features of a CVP income statement...Ch. 6 - The traditional income statement for Wheat Company...Ch. 6 - Prob. 6QCh. 6 - What is meant by the term sales mix? How does...Ch. 6 - Prob. 8QCh. 6 - Prob. 9QCh. 6 - Prob. 10Q
Ch. 6 - What is the theory of constraints? Provide some...Ch. 6 - What is meant by "cost structure? Explain how a...Ch. 6 - What is operating leverage? How does a company...Ch. 6 - Prob. 14QCh. 6 - Prob. 15QCh. 6 - Prob. 16QCh. 6 - Distinguish between absorption costing and...Ch. 6 - Prob. 18QCh. 6 - Prob. 19QCh. 6 - Prob. 20QCh. 6 - Prob. 21QCh. 6 - Prob. 22QCh. 6 - Determine missing amounts for contribution margin....Ch. 6 - Hamby Inc. has sales of 2,000,000 for the first...Ch. 6 - Prob. 6.3BECh. 6 - Prob. 6.4BECh. 6 - Prob. 6.5BECh. 6 - Prob. 6.6BECh. 6 - NoFly Corporation sells three different models of...Ch. 6 - Information for NoFly Corporation is given in...Ch. 6 - Prob. 6.9BECh. 6 - Prob. 6.10BECh. 6 - In Marshall Company, data concerning two products...Ch. 6 - Prob. 6.12BECh. 6 - Prob. 6.13BECh. 6 - Prob. 6.14BECh. 6 - Prob. 6.15BECh. 6 - Compute product costs under variable costing. (LO...Ch. 6 - Compute product costs under absorption costing....Ch. 6 - Prob. 6.18BECh. 6 - Prob. 6.19BECh. 6 - Victoria Company reports the following operating...Ch. 6 - Prob. 6.2DICh. 6 - Zoom Corporation manufactures and sells three...Ch. 6 - Prob. 6.4DICh. 6 - Prob. 6.1ECh. 6 - In the month of June, Jose Heberts Beauty Salon...Ch. 6 - Compute net income under different alternatives....Ch. 6 - Prob. 6.4ECh. 6 - Prob. 6.5ECh. 6 - Yard Tools manufactures lawnmowers, weed-trimmers,...Ch. 6 - PDQ Repaint has 200 auto-maintenance service...Ch. 6 - Express Delivery is a rapidly growing delivery...Ch. 6 - Prob. 6.9ECh. 6 - Determine break-even point in dollars for two...Ch. 6 - Mars Company manufactures and sells three...Ch. 6 - Compute contribution margin and determine the...Ch. 6 - Helena Company manufactures and sells two...Ch. 6 - The CVP income statements shown below are...Ch. 6 - Casas Modernas of Juarez, Mexico, is contemplating...Ch. 6 - Prob. 6.16ECh. 6 - Compute product cost and prepare an income...Ch. 6 - Prob. 6.18ECh. 6 - Crate Express Co. produces wooden crates used for...Ch. 6 - Midlands Inc. had a bad year in 2016. For the...Ch. 6 - Lorge Corporation has collected the following...Ch. 6 - Determine break-even sales under alternative sales...Ch. 6 - Prob. 6.4APCh. 6 - The following CVP income statements are available...Ch. 6 - Bonita Beauty Corporation manufactures cosmetic...Ch. 6 - Prepare income statements under absorption costing...Ch. 6 - Dilithium Batteries is a division of Enterprise...Ch. 6 - CURRENT DESIGNS Current Designs manufactures two...Ch. 6 - Prob. 6.1BYPCh. 6 - Managerial Analysis For nearly 20 years,...Ch. 6 - Real-World Focus In a recent report, the Del Monte...Ch. 6 - The June 8, 2009, edition of the Wall Street...Ch. 6 - Prob. 6.6BYPCh. 6 - Ethics Case Brett Stem was hired during January...Ch. 6 - Prob. 6.9BYP
Additional Business Textbook Solutions
Find more solutions based on key concepts
Do companies always reclassify long-term debt that becomes callable by the creditor a short-term obligation? Ex...
Intermediate Accounting
16. (a) When entering a transaction in the journal, should the debit or credit be written first?
(b) Which shou...
Financial Accounting
Think about a recent purchase you made. Describe what financial and nonfinancial factors went into that purchas...
Principles of Accounting Volume 1
E3-18 Comparing cash and accrual basis accounting and applying the revenue recognition principle
Learning Ob...
Horngren's Accounting (12th Edition)
(Record inventory transactions in the periodic system) Wexton Technologies began the year with inventory of 560...
Financial Accounting (11th Edition)
All of the following events at a sandwich shop are transactions except a. A customer purchases a sandwich. b. A...
Financial Accounting (12th Edition) (What's New in Accounting)
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
- In the month of August, Beauty Salon services 560 clients at an average price of $120. During the month, fixed costs were $21,024 and variable costs were 60% of sales. Determine the total contribution margin in dollars, the per unit contribution margin, and the contribution margin ratio. Contribution margin in dollars? Contribution margin per unit? Contribution margin ratio? Using the contribution margin technique, compute the break-even point in dollars and in units. Break-even sales? (in dollars) Break-even sales? (in units)arrow_forwardIn the month of June, Jose Hebert’s Beauty Salon gave 4,125 haircuts, shampoos, and permanents at an average price of $40. During the month, fixed costs were $16,500 and variable costs were 75% of sales. (a) Determine the contribution margin in dollars, per unit and as a ratio. (Round contribution margin and contribution margin per unit to 2 decimal places, e.g. 5.75.) Contribution margin $ Contribution margin per unit $ Contribution margin ratio %arrow_forwardIn the month of June, Sunland Hebert’s Beauty Salon gave 4,000 haircuts, shampoos, and hair colorings at an average price of $50. During the month, fixed costs were $16,000 and variable costs were 75% of sales. Determine the contribution margin in dollars, per unit and as ratio Using the contribution margin technique, compute the break-even point in dollars and in units. Compute the margin of safety in dollars and as a ratio.arrow_forward
- In the month of March, Pharoah Salon services 630 clients at an average price of $100. During the month, fixed costs were $14,880 and variable costs were 68% of sales. (A) Determine the total contribution margin in dollars, the per unit contribution margin, and the contribution margin ratio. Contribution margin in dollars $ Contribution margin per unit $ Contribution margin ratio % (B) Using the contribution margin technique, compute the break-even point in dollars and in units. Break-even sales $ Break-even sales unitsarrow_forwardIn June, Wildhorse Salon gave 3,500 haircuts, shampoos, and permanents at an average price of $ 50. During the month, fixed costs were $ 31,000 and variable costs were 80% of sales. Determine the contribution margin in dollars, per unit, and as a ratio. (Round per unit value to 2 decimal places, e.g. 52.75 and final answer to 0 decimal places, e.g. 5,275.) Contribution margin (in dollars) 2$ Contribution margin (per unit) Contribution margin (ratio) % Using the contribution margin technique, compute the break-even sales dollars and sales units. Break-even sales dollars $ Break-even sales units units Compute the margin of safety dollars and as a ratio. (Round answers to 0 decimal places, e.g. 5,275.) Margin of safety in dollars $ Margin of safety ratio %24arrow_forwardIn the month of June, Jose Hebert's Beauty Salon gave 3,800 haircuts, shampoos, and permanents at an average price of $30. During the month, fixed costs were $16,900 and variable costs were 75% of sales. Contribution margin $ Contribution margin per unitarrow_forward
- In the month of September, Matiock Industries sold 800 units of product. The average sales price was $30. During the month, fixed costs were $6,300 and variable costs were 70% of sales. Instructions (a) Determine the contribution margin in dollars, per unit, and as a ratio. (b) Using the contribution margir technique, compute the break-even point in dollars and in units.arrow_forwardIn the month of March, Style Salon services 560 clients at an average price of $ 120. During the month, fixed costs were $ 21,024 and variable costs were 60% of sales. (a) Determine the total contribution margin in dollars, the per unit contribution margin, and the contribution margin ratio. Contribution margin in dollars $ Contribution margin per unit $ Contribution margin ratio %arrow_forwardIn the month of September, Nixon Company sold 800 units of product. The average sales price was $30. During the month, fixed costs were $7,200 and variable costs were 60% of sales.1. Determine the contribution margin in dollars 2. Determine the contribution margin per unit 3. Determine the contribution margin ratio. 4. Using the contribution margin technique, compute the break-even point in dollars 5. Using the contribution margin technique, compute the break-even point in units.arrow_forward
- During the month of September, Chase's Barbershop engaged with 590 clients at an average price of $200. During the month, fixed costs were $26,536 and variable costs were 69% of sales. (Do not use commas or dollar signs in your responses.) Contribution margin in dollars $ Contribution margin per unit $ Contribution margin ratioarrow_forwardIn the month of September, Nixon Company sold 800 units of product. The average sales price was $30. During the month, fixed costs were $7,200 and variable costs were 60% of sales. 4. Using the contribution margin technique, compute the break-even point in dollars 5. Using the contribution margin technique, compute the break-even point in unitsarrow_forwardLast month Annie's Homemade total sales and variable costs for 6-ounce servings were $18,000 and $4,500, respectively. Its total sales and variable costs for 8-ounce servings were $7,000 and $1,750, respectively. Its total fixed costs for the month were $11,000. Required: 1. What was last month's overall contribution margin ratio? 2. Using last month's data, what is the company's overall break-even point in dollar sales? Note: Round up to the nearest whole dollar. Complete this question by entering your answers in the tabs below. Required 1 Required 2 What was last month's overall contribution margin ratio? The overall contribution margin ratio was %arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
What is variance analysis?; Author: Corporate finance institute;https://www.youtube.com/watch?v=SMTa1lZu7Qw;License: Standard YouTube License, CC-BY