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Unformatted text preview: E6-2In the month of June, Paula's Beauty Salon gave 3,600 haircuts, shampoos, and permanents at an average price of $31. During the month, fixed costs were $16,368 and variable costs were 76% of sales.Determine the contribution margin in dollars, per unit, and as a ratio: (Round answers to 0 decimal places, e.g. 125.)Contribution margin in dollars: $ Contribution margin per unit: $Contribution margin ratio: $Using the contribution margin technique, compute the break-even point in dollars and in units. ((Round answers to 0 decimal places, e.g. 125.)Margin of safety in dollars$Margin of safety ratio$E7-2Gruner Company produces golf discs which it normally sells to retailers for $7.08 each. The cost of manufacturing 17,900 golf discs is:Materials$9,308Labor27,029Variable overhead19,511Fixed overhead36,516Total$92,364Gruner also incurs 7% sales commission ($0.50) on each disc sold.Travis Corporation offers Gruner $4.81 per disc for 5,300 discs. Travis would sell the discs under its own brand name in foreign markets not yet served by Gruner. If Gruner accepts the offer, its fixed overhead will increase from $36,516 to $41,057 due to the purchase of a new imprinting machine. No sales commission will result from the special order.Prepare an incremental analysis for the special order. (If answer is zero, please enter 0. Do not leave any fields blank. If amount decreases the income, use either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Enter all amounts in columns "Reject Order" and "Accept Order" as positive amounts parentheses e....
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This note was uploaded on 04/17/2011 for the course ACCOUTING AC 330 taught by Professor Karinamendoza during the Spring '11 term at Kaplan University.
- Spring '11