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ACC221_PART_2

# ACC221_PART_2 - 1.High-low method High point 9590.44 436...

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1.High-low method High point: 9590.44 436 Low point: 9499.38 122 VC per unit 91.06 314 0.29 9590.44-9499.38=91.06 Using low point TC=FC+VC 9499.38=FC+122*0.29 FC= 9464 The cost formula for the customer-service department: Y=9464+0.29*X 2.Contribution margin per unit Per Unit Sales 1.5 Variable Cost 0.41 0.29+0.05+0.04+0.03=0.41 CM per unit 1.09 3.Contribution Margin Ratio CM Ratio 0.73 1.09/1.5=0.726667 4.Break-even point(units) Total Fixed Expenses= 9464+35000+5500 = 49964 Break-even=Fixed Expenses/Unit Contribution Margin =49964/1.09 =45838.53 5.Break-even point in sales dollars: Break-even point(units)*sales per unit 45838.53*1.5= 68757.8

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436-122=314 91.06/314=0.29
6.Contribution Margin Income Statement: Bender Bolts, Inc. Contribution Margin Income Statement For the month ended 12/31 Total dollars Per Un Sales(75600*1.50) 113400 Less:Variable Costs Customer Service(75600*0.29) 21924 0.29 Steel(75600*0.05) 3780 0.05 Direct Labor(75600*0.04) 3024 0.04 Selling&Administrative(75600*0.03) 2268 0.03 Total variable cost 30996 Contribution Margin 82404 Less:Fixed Costs Customer Service 9464 Manufacturing 35000 Selling and administrative 5500 Total fixed costs 49964 Net operation income 32440 7.Margin of safety dollars Break-even sales dollars: 68757.8

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