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Safari File Edit View History Bookmarks Window Help ? ? , 58%)?· ) Tue Jun 19 6:35 PM Alex C ezto.mheducation.com Home - alamo.edu Chapter 6 Exercises value 11.11 points Sandy Bank, Inc., makes one model of wooden canoe. Partial information for it follows: 1. Complete the following table. (Round your \"Cost per Unit\" answers to 2 decimal places.) ber of Canoes Produced and Sold 480 570 780 Total costs S 68,640 156,960 S 225,600 Variable Costs Fixed Costs Total Costs Cost per Unit Variable Cost per Unit Fixed Cost per Unit Total Cost per Unit 2. Suppose Sandy Bank sells its canoes for $500 each. Calculate the contribution margin per canoe and the contribution margin ratio. (Round your intermediate calculations and final answers to 2 decimal places. Round your \"percentage\" answer to 2 decimal places. (i.e. .1234 should be entered as 12.34%.)) Unit Contribution Margin Contribution Margin Ratio per Canose popcorntime ap

Solution

Answers

No. of canoes produced and sold

480

570

780

Total Costs:

Variable

$       68,640.00

$                81,510.00

$             1,11,540.00

Fixed

$    1,56,960.00

$            1,56,960.00

$             1,56,960.00

Total Costs

$    2,25,600.00

$            2,38,470.00

$             2,68,500.00

Cost per unit:

Variable cost per unit

$             143.00

$                      143.00

$                      143.00

Fixed cost per unit

$             327.00

$                      275.37

$                      201.23

Total Cost per unit

$             470.00

$                      418.37

$                      344.23

---Working for above---

No. of canoes produced and sold

480

570

780

Total Costs:

Variable

68640

=570*143

=780*143

Fixed

156960

156960

156960

Total Costs

TOTAL

TOTAL

TOTAL

Cost per unit:

Variable cost per unit

=68640/480

=81510/570

=111540/780

Fixed cost per unit

=156960/480

=156960/570

=156960/780

Total Cost per unit

TOTAL

TOTAL

TOTAL

A

Unit Sale price

$             500.00

B

Unit Variable cost

$             143.00

C=A-B

Unit Contribution margin

$             357.00

D=(C/A) x 100

Contribution margin ratio

71.40%

A

Sales revenue [850 x $500]

$    4,25,000.00

B

Variable cost [850 x $143]

$    1,21,550.00

C=A-B

Contribution margin

$    3,03,450.00

D

Fixed Cost

$    1,56,960.00

E=C - D

Income from Operations

$    1,46,490.00

A

Total fixed cost

$    1,56,960.00

B

Unit Contribution margin

$             357.00

C=A/B

Break Even units

440

D

Contribution margin ratio

71.40%

E=A/D

Break Even Sales revenue

$          2,19,832

A

Target Profits

$       85,000.00

B

Total fixed cost

$    1,56,960.00

C=A+B

Total contribution margin required

$    2,41,960.00

D

Unit Contribution margin

$             357.00

E=C/D

No. of canoes to be sold to earn target profits

678

No. of canoes produced and sold	480	570	780
Total Costs:
Variable	$       68,640.00	$                81,510.00	$             1,11,540.00
Fixed	$    1,56,960.00	$            1,56,960.00	$             1,56,960.00
Total Costs	$    2,25,600.00	$            2,38,470.00	$             2,68,500.00
Cost per unit:
Variable cost per unit	$             143.00	$                      143.00	$                      143.00
Fixed cost per unit	$             327.00	$                      275.37	$                      201.23
Total Cost per unit	$             470.00	$                      418.37	$                      344.23