eBook

Contribution margin, break$-$even sales, cost$-$volume$-$profit chart, margin of safety, and operating leverage

Belmain Co$.$ expects to maintain the same inventories at the end of $20Y7$ as at the beginning of the year. The total of all production $c$ be equal to the cost of goods sold. With this in mind, the various department heads were asked to submit estimates of the costs for $t$ summary report of these estimates is as follows:

Estimated Estimated Variable Cost

Fixed Cost $($per unit sold$)$

Production costs:

Direct materials

Direct labor

Factory overhead

Selling expenses:

Sales salaries and commissions

Advertising

Travel

Miscellaneous selling expense

Administrative expenses:

Office and officers' salaries

Supplies

Miscellaneous administrative expense

Total

$41,400$

$14,000$

$3,100$

$3,400$

$3$

$3$

$-$

$3$

$6$

$$199,100$

$$13$

$9$

$$