Refer to the information for Tweety Company in E5-1. Suppose it sells each birdbath for $20.

Required:

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

Data from E5-1

Tweety Company manufactures one model of birdbath, which is very popular. Tweety sells all units it produces each month. The relevant range is 0-1,500 units, and monthly production costs for the production of 1,000 units follow. Tweety’s utilities and maintenance costs are mixed with the fixed components shown in parentheses.

Transcribed Image Text:

Production Costs Direct materials Direct labor Utilities ($100 fixed) Supervisor's salary Maintenance ($280 fixed) Depreciation Amount $ 1,500 7,500 650 3,000 480 800