Basic Cost Volume Profit Concepts Klamath Company Produces A Single Product The Projected Income Statement For The Comi 1 (36.42 KiB) Viewed 31 times
Basic Cost Volume Profit Concepts Klamath Company Produces A Single Product The Projected Income Statement For The Comi 2 (32.59 KiB) Viewed 31 times
Basic Cost-Volume-Profit Concepts Klamath Company produces a single product. The projected income statement for the coming year is as follows: Sales (70,000 units @ $30.00) $2,100,000 Total variable cost 1,029,000 Contribution margin. $ 1,071,000 1,156,680 Operating income $ (85,680) Required: 1. Compute the unit contribution margin and the units that must be sold to break even. Unit contribution margin Break-even units units 2. Suppose 10,000 units are sold above breakeven. What is the operating income? 3. Compute the contribution margin ratio. Use the contribution margin ratio to compute the break-even point in sales revenue. Contribution margin ratio % Break-even sales revenue Suppose that revenues are $200,000 more than expected for the coming year. What would the total operating income be? Total fixed cost
Klamath Company produces a single product. The projected income statement for the coming year is as follows: Sales (70,000 units @ $30.00) $2,100,000 Total variable cost 1,029,000 Contribution margin $ 1,071,000 1,156,680 Operating income $ (85,680) Required: 1. Compute the unit contribution margin and the units that must be sold to break even. Unit contribution margin Break-even units units 2. Suppose 10,000 units are sold above breakeven. What is the operating income? 3. Compute the contribution margin ratio. Use the contribution margin ratio to compute the break-even point in sales revenue. Contribution margin ratio % Break-even sales revenue Suppose that revenues are $200,000 more than expected for the coming year. What would the total operating income be? Total fixed cost
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