M Problem-Solving Example 5.1 Setting Costs Apart List the following monthly home budget accounts under the headings fixed, variable, and semi-fixed costs. Find the total fixed costs, the total variable costs, and the total costs. The percentages are the por- tion of the cost that is variable: mortgage, $1,300; municipal taxes, $150; mobile phone, $55 (10%); cable TV, $90 (10%); water, $40 (15%); food, $200; entertainment, $100; car and house insurance, $140; heating, $100 (30%); payment for car loan ($125); gasoline, $100 (50%); hydro, $75 (20%); and alarm system, $30. Problem-Solving Example 5.2 Contribution Margin and the PV Ratio Using the expense accounts shown in Problem-Solving Example 5.1, and assuming that Jin's salary is $3,500 a month, calculate (1) his contribution margin and, (2) his PV ratio. Self-Test Exercise 5.2 The Contribution Margin and the PV Ratio Use the following information to calculate CompuTech's (1) profit before taxes, (2) contribution margin, and (3) PV ratio. Purchases (cost of sales) $205,000 Salaries (administration) $38,000 Freight-in (cost of sales) 4,000 Revenue 420,000 Salaries (distribution) 60,000 Depreciation/amortization 40,000 Commissions 3,000 Leasing 7,000 Travel 3,000 Finance costs 14,000 Advertising 5,000