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# p5-2b - Name Date Instructor Course rd Managerial...

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FileName: cee71089dda4f8b406021b2e6d7eb4dbbafb1ba1.xls, Tab: Problem P5-2B, Page 1 of 2, 12/28/2011, 19:02:06 Name: Date: Instructor: Course: \$0.40 per 16 ounce bottle to retailers, who charge customers \$0.60 per bottle. Management estimates the following revenues and costs: Net sales \$1,500,000 Selling expenses - Variable \$80,000 Direct materials 400,000 Selling expenses - Fixed 65,000 Direct labor 250,000 Admin expenses - Variable 20,000 Mfg overhead - Variable 300,000 Admin expenses - Fixed 52,000 Mfg overhead - Fixed 93,000 Instructions: Net sales Amount Less: Variable costs Title Amount Title Amount Title Amount Total variable expenses Formula Contribution margin Formula Fixed costs Title Amount Title Amount Title Amount Total fixed costs Formula Variable costs = Amount of sales or Amount per bottle Break-even point in units = Value = Value + Value Break-even point in units = Formula units Break-even point in dollars = Amount X Amount = Formula Contribution margin ratio = ( Amount - Amount ) / Amount Contribution margin ratio = Formula Margin of safety ratio = ( Amount - Amount ) / Amount Margin of safety = Formula \$120,000

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