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Problem 3-48

# Problem 3-48 - Breakeven number of units = Fixed...

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Cost Accounting Lydia Holmes Problem 3-48 1. Calculate Allen Corporation's breakeven revenues for 2005. 40% 5,400,000 2. Calculate Allen Corporation's breakeven revenues if variable costs are 52% of revenues. 52% of revenue 2,600,000 48% 4,500,000 3. Calculate Allen Corporation's operating income for 2005 if variable costs had been 52% of r 2,600,000 240,000 Contribution Margin = Revenue - variable cost/revenue

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Unformatted text preview: Breakeven number of units = Fixed cost/Contribution margin Contribution Margin = Revenue - variable cost/revenue Breakeven number of units = Fixed cost/Contribution margin 52% of revenue = new variable cost Revenues - Variable costs - Fixed costs = Operating income Revenues 5,000,000 Variable Costs 3,000,000 Fixed Costs 2,160,000 Operating Income \$(160,000.00) revenues....
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