Question: Part 2 - Short Answer Questions [30 points] Prompt #2.1 SC Cola brews diet soda and regular soda. Sales of its diet soda represent 25%

Part 2 - Short Answer Questions [30 points] Prompt #2.1 SC Cola brews diet soda and regular soda. Sales of its diet soda represent 25% of the company's total revenue. Sales of regular soda represent the remaining 75%. Diet soda has a contribution margin ratio of 80%, whereas the contribution margin ratio of regular soda is only 60%. SC Cola's monthly fixed costs average $609,500. A. What is the company's monthly break-even point expressed in sales dollars? B. What monthly sales level must be achieved for SC Cola to earn a monthly operating income of $350,000? C. If SC Cola generates $1,400,000 in monthly sales, how much monthly operating income will the company earn? D. Assume SC Cola's margin of safety was $300,000 in May. What was the company's operating income in May? E. If SC Cola's monthly fixed costs increase by $8,500, what level of monthly sales revenue will be required to break-even

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!