8) The contribution margin ratio:
A) Is the percent of each sales dollar that remains afterdeducting total unit variable costs
B) Is the percent of each sales dollar that remains afterdeducting total unit fixed costs
C) Is the percent of each sales dollar that remains to coverfixed costs and contribute to managers incomes
D) Cannot be used in conjuction with other analytical tools
E) Is the same as the unit contribution margin
8) The contribution margin ratio:
A) Is the percent of each sales dollar that remains afterdeducting total unit variable costs
B) Is the percent of each sales dollar that remains afterdeducting total unit fixed costs
C) Is the percent of each sales dollar that remains to coverfixed costs and contribute to managers incomes
D) Cannot be used in conjuction with other analytical tools
E) Is the same as the unit contribution margin
Related questions
Presidio, Inc. produces one model of mountain bike. Partial information for the company follows:
Required:
1. Complete Presidioâs cost data table. (Round your Cost per Unit answers to 2 decimal places.)
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2. Calculate Presidioâs contribution margin ratio and its total contribution margin at each sales level indicated in the cost data table assuming the company sells each bike for $630. (Round your Margin Ratio percentage answers to 2 decimal places (i.e. .1234 should be entered as 12.34%.))
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3. Calculate net operating income (loss) at each of the sales levels assuming a sales price of $630. (Round your answers to the nearest whole dollar amount.)
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Presidio, Inc. produces one model of mountain bike. Partialinformation for the company follows:
Required: 1. Complete Presidioâs cost data table. (Round yourCost per Unit answers to 2 decimal places.)
| Bikes produced and sold | 410 Units | 770 Units | 1924 Units |
| Total Costs | |||
| Variable costs | $106,600 | ||
| Fixed costs | |||
| Total Costs | |||
| Cost per unit | |||
| Variable cost per unit | |||
| Fixed cost per unit | |||
| Total Cost per unit | $532 |
2. Calculate Presidioâs contribution margin ratio and its totalcontribution margin at each sales level indicated in the cost datatable assuming the company sells each bike for $610. (Round yourMargin Ratio percentage answers to 2 decimal places (i.e. .1234should be entered as 12.34%.))
| 410 units | 770 Units | 1924 Units | ||||
| Total Contribution Margin | ||||||
| Contribution Margin Ratio | % | % | % |
3. Calculate net operating income (loss) at each of the saleslevels assuming a sales price of $610. (Round your answers to thenearest whole dollar amount.)
| 410 Units | 770 Units | 1924 Units | |
Net Operating Income (Loss) |
Variable Costs, Contribution Margin, Contribution Margin Ratio
Super-Tees Company plans to sell 12,000 T-shirts at $16 each in the coming year. Product costs include:
| Direct materials per T-shirt | $5.75 |
| Direct labor per T-shirt | $1.25 |
| Variable overhead per T-shirt | $0.60 |
| Total fixed factory overhead | $43,000 |
Variable selling expense is the redemption of a coupon, which averages $0.80 per T-shirt; fixed selling and administrative expenses total $19,000.
Required:
1. Calculate the following values:
Round dollar amounts to the nearest cent and round ratio values to three decimal places.
| a. Variable product cost per unit | $ |
| b. Total variable cost per unit | $ |
| c. Contribution margin per unit | $ |
| d. Contribution margin ratio | |
| e. Total fixed expense for the year | $ |
Feedback
2. Prepare a contribution-margin-based income statement for Super-Tees Company for the coming year. If required, round your per unit answers to the nearest cent.
| Super-Tees Company | ||
| Contribution-Margin-Based Operating Income Statement | ||
| For the Coming Year | ||
| Total | Per Unit | |
| < >SalesTotal contribution marginTotal fixed expenseTotal variable expense | $ | $ |
| < >SalesTotal contribution marginTotal fixed expenseTotal variable expense | ||
| < >SalesTotal contribution marginTotal fixed expenseTotal variable expense | $ | $ |
| < >SalesTotal contribution marginTotal fixed expenseTotal variable expense | ||
| < >Operating incomeOperating lossSalesTotal contribution margin | $ | |
Feedback
3. What if the per unit selling expense increased from $0.80 to $1.75? Calculate new values for the following:
Round dollar amounts to the nearest cent and round ratio values to four decimal places:
| a. Variable product cost per unit | $ |
| b. Total variable cost per unit | $ |
| c. Contribution margin per unit | $ |
| d. Contribution margin ratio | |
| e. Total fixed expense for the year | $ |
