Refer to the data in PE 21-11. Compute the contribution margin ratio and the variable cost ratio.
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Refer to the data in PE 21-11. Compute the contribution margin ratio and the variable cost ratio.
Data from PE 21-11
Loeffel Company sells desks for $550 each. Th e variable cost per desk is $375. The company’s monthly fixed costs are $75,000. Prepare a contribution margin income statement for a month in which the company sells 550 desks.
Contribution MarginContribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...
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Related Book For
Accounting concepts and applications
ISBN: 978-0538745482
11th Edition
Authors: Albrecht Stice, Stice Swain
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