Show your work to get any partial credit. Give me the formula that you might use or show other thought process. If you just give me an answer and it’s not the right one you will get zero points for that question.
Other formulas needed outside of the reading material:
Sales = Variable expenses + Fixed expenses +Profit
Sales = Quantity * Units
Profit = (Sales CM ratio) Fixed Cost
Review Problems : Contribution margin and ratio
Sales per unit = $250Variable Cost per unit = $150
Units = 350
Sales = $5000000CM Ratio = 0.40Fixed cost = $1600000
A company has budgeted sales of $200000 a profit of$60000 and fixed expenses of $40000.
Review Problem : Break-even point
Voltar Company manufactures and sells a telephone answering machine. The company’s contribution format income statement for the most recent year is given below:
Management is anxious to improve the company’s profit performance. Assume that next year management wants the company to earn a minimum profit of $90000.