1. During March, a company expects its total sales to be $158,000, its total variable costs to be $94,800, and its total fixed costs to be $24,800. What is the contribution margin for March?

2. A company expects to sell 25,600 units of its product for $11.60 per unit and incur variable costs per unit of $6.60. Total fixed costs are $76,000. What is the total contribution margin.

3. Watson Company has monthly fixed costs of $85,000 and a contribution margin ratio of 40%. If the company has set a target monthly revenue of $15,200, what dollar amount of sales must be made to produce the target revenue?

4. Henderson Co. has fixed costs of $21,000 and a contribution margin ratio of 30%. If expected sales are $100,000, what is the margin of safety as a percentage of sales?

5. Locus Company has total fixed costs of $112,000. Your product sells for $35 per unit, and variable costs are $25 per unit. Next year, Locus Company wants to earn pre-tax income equal to 10% of fixed costs. How many units must be sold to achieve this target revenue level?

6. The Raven Company has a goal of earning a pre-tax income of $71,100. The contribution margin ratio is 32%. What dollar amount of sales must be achieved to reach the goal if fixed costs are $38,200?

7. 

The following information is available for a company's cost of sales for the past five months.

Mes	units sold	cost of sales
January	450	$33,000
February	850	$39,500
March	1,850	$51,500
April	2,650	$63,500

Using the high-low method, the estimated variable cost of sales per unit sold is:

8. During its first year of operations, the McCormick Company incurred the following manufacturing costs: direct materials, $4 per unit, direct labor, $2 per unit, variable overhead, $3 per unit, and fixed overhead, $192,000. The company it produced 24,000 units and sold 17,000 units, leaving 7,000 units in inventory at the end of the year. What is the value of ending inventory under absorption costing?

9. During its first year of operations, the McCormick Company incurred the following manufacturing costs: direct materials, $4 per unit, direct labor, $2 per unit, variable overhead, $3 per unit, and fixed overhead, $256,000. The company it produced 32,000 units and sold 26,500 units, leaving 5,500 units in inventory at the end of the year. What is the value of ending inventory under variable costing?

During its first year of operations, the McCormick Company incurred the following manufacturing costs: direct materials, $7 per unit, direct labor, $5 per unit, variable overhead, $6 per unit, and fixed overhead, $270,000. The company it produced 27,000 units and sold 18,500 units, leaving 8,500 units in inventory at the end of the year. Variable cost calculated revenue is determined to be $355,000. How much revenue is reported under absorption cost?

Answer rating: 100% (QA)

SOLUTION 1 Contribution Margin Total Sales Total Variable Costs Total Fixed Costs Contribution Margi... View the full answer