28-4, 28-5

CHAPTER 28 REVIEW, PRACTICE, AND APPLY Exercise 28-4 Objective: To calculate contribution margin, contribution margin ratio, and unit contribution margin The records of Standish Corporation show the following information as of December 31, 20xx: Learning Objective 3 Check Figure (b) Contribution margin ratio 35% 5,000 units $50 $162,500 $50,000 Sales Variable costs Fixed costs Directions: Calculate Standish's (a) contribution margin, (b) contribution margin ratio, and (c) unit contribution margin. Leaming Objective 3 Exercise 28-5 Objective: To use the contribution margin ratio and the unit contribution margin Marley Company's contribution margin ratio is 30%, its unit selling price is S30, and its unit variable cost is $21. Check Figure (a) $15,000 increase Directions: What is the effect on operating income if (a) sales rose by $50,000, (b) sales decreased by $80,000, (c) sales increased by 3,000 units, and (d) sales decreased by 1,000 units