Chapter 9 - Name Nguyen Thi Lan Thanh Class Tuesday...

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Name: Nguyen Thi Lan Thanh Class: Tuesday Afternoon ID: 1236311 CHAPTER 9 9 / Total variable cost = $50,000 + $37,500 + $75,000 = $162,500 a) The variable production cost per unit is: $162,500 : 150,000 = $1.083 b) CM = Revenue – (COGS + Selling and administrative) = $240,000 – $162,500 = $77,500 The total contribution margin per unit is: $77,500 : 90,000 = $0.86 c) A variable costing statement: COGS = $1.083 x 90,000 = $97,470 FC = FOH + Selling and administrative = $56,250 + $50,000 = 106,250 Sales $240,000 Less variable costs: Cost of goods sold $97,470 Selling and administration $45,000 Total variable cost $142,470 Contribution margin $ 97,530 Less fixed expenses: Manufacturing overhead $56,250 Selling and administration $50,000 Total fixed cost $106,250 Net income (loss) $ 8,720 10 / Total revenue, Total cost, Income before tax increase when product volume goes up by one unit at Leroy’s Axles. 11 / a) Contribution margin per unit = $30 -$15 = $15 The break-even point in units is: X = Fixed cost : Contribution margin per unit = $60,000 : $15 = 4,000 in units
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b) Contribution margin ratio = Contribution margin per unit : Revenue = $15 : $30 =0.5 or 50% The break-even point in dollar is: X = Fixed cost : Contribution margin Ratio = $60,000 : 0.5 = 120,000 in sales dollars 14 / Variable cost = 70% Sale Contribution margin = 30% Sale Sale = ($300,000 + $600,000) : (100% - 70%) = $3,000,000 Minimum price which it must sell its product:
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This note was uploaded on 11/23/2011 for the course MANAGEMENT 101 taught by Professor Nguyen during the Spring '11 term at Troy.

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Chapter 9 - Name Nguyen Thi Lan Thanh Class Tuesday...

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