- Variable Cost Ratio Contribution Margin Ratio Instructions Amount Descriptions Ratios Contribution Margin Income Statem 1 (72.42 KiB) Viewed 12 times
1.
Calculate the variable cost ratio.
2. Calculate the contribution margin ratio.
3. Prepare a contribution margin income statementbased on the budgeted figures for next year. In a columnnext to the income statement, show the percentages based on salesfor sales, total variable cost, and total contribution margin.Refer to the list of Amount Descriptions for the exact wording oftext items within your income statement.
Variable Cost Ratio, Contribution Margin Ratio Instructions Amount Descriptions Ratios Contribution Margin Income Statement Instructions Variable Cost Ratio, Contribution Margin Ratio Head-First Company plans to sell 5,000 bicycle helmets at $75 each in the coming year. Unit variable cost is $45 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Fixed factory overhead is $20,000 and fixed selling and administrative expense is $29,500. Required: 1. Calculate the variable cost ratio. 2. Calculate the contribution margin ratio. 3. Prepare a contribution margin income statement based on the budgeted figures for next year. In a column next to the income statement, show the percentages based on sales for sales, total variable cost, and total contribution margin. Check My Work Previous Next