Question

Refer to the information for Morning Dove Company in E5-2. Suppose it sells each birdbath for $25.
Production Costs ... Total Cost
Direct materials ..... $1,500
Direct labor ..... 7,500
Utilities ($100 fixed) ... 650
Supervisor’s salary ... 3,000
Maintenance ($280 fixed) . 480
Depreciation ...... 800

Required:
1. Calculate the unit contribution margin and contribution margin ratio for each birdbath sold.
2. Prepare a contribution margin income statement assuming that Morning Dove produces and sells 1,400 units.



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  • CreatedFebruary 27, 2015
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