HANDOUT $2-$ COST$-$VOLUME$-$PROFIT ANALYSIS

THIS HANDOUT CONSISTS OF PARTS A AND B

PART A

McKeever Sports sells decals that can be personalized with a player's name, a team name, and a jersey number for $$6$ each. The company buys the licensed decals from a supplier for $$1\mathrm{.}50$ each and spends an additional $$1\mathrm{.}00$ in yariable operating expenses per decal $($the remaining amount of operating expenses are considered fixed$).$ The results of last month's operations are as follows $-$ based on sales of $1,500$ decals:

$\backslash$table$[[$DESCRIPTION$,$AMOUNT,QUESTION,ANSWER$],[$Sales Revenue,$$9,000,$What is the Variable Cost Per Unit?,$],[$Cost of Goods Sold,$$2,250,],[$Gross Profit,$$6,750,],[$Operating Expenses,$$3,250,$What are the Total Fixed Costs?,$],[$Operating Income,$$3,500,]]$

$\backslash$table$[[$USING THE INFORMATION PROVIDED, COMPLETE THE CVP ANALYSIS FOR MCKEEVER SPORTS$],[$DESCRIPTION$,$AMOUNT,REQUIRED $-$ SHOW WORK HERE$],[,,],[$BREAKEVEN$,,],[$UNITS$,,],[$BREAKEVEN IN$,,],[$SALES $ $($USE CM$,,],[$RATIO$\%),,],[$# OF UNITS TO$,,],[$REACH $$12,250$ OF$,,],[$DESIRED INCOME,,$]]$

ACCT $201|$ MANAGERIAL ACCOUNTING I

HANDOUT $2-$ CHAPTER $3|$PAGE $1$