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GenaCL600 [577]
3 years ago
15

The following costs result from the production and sale of 4,450 drum sets manufactured by Tight Drums Company for the year ende

d December 31, 2019. The drum sets sell for $295 each. The company has a 30% income tax rate.
Variable production costs
Plastic for casing $185,000
Wages of assembly workers 510,000
Drum stands 230,000
Variable selling costs
Sales commissions 175,000
Fixed manufacturing costs
Taxes on factory 5,000
Factory maintenance 10,000
Factory machinery depreciation 70,000
Fixed selling and administrative costs
Lease of equipment for sales staff 10,000
Accounting staff salaries 60,000
Administrative management salaries 140,000

Required:
Prepare a contribution margin income statement for the company.
Business
1 answer:
Debora [2.8K]3 years ago
6 0

Answer:

Explanation:

Sales  1,312,750  [4450*295]

Variable Costs

Variable production costs :

Plastic for casing  185,000  

Wages of assembly workers  510,000  

Drum stands 230,000  

Variable selling costs :

Sales commission  175,000

<u>Total Variable Costs  1,100,000  </u>

Contribution Margin  312,750

Less: Fixed Costs

Taxes on factory  5000

Factory maintenance  10,000

Factory machinery depreciation  70,000

Lease of equipment for sales staff  10,000

Accounting staff salaries  60,000

Administrative management salaries  140,000

Total fixed costs 295,000

Profit Before Tax  17,750

Less: Income tax [17,750*30%] 5,350

Net income 12,425

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Utilization = [200 x 1 + (45/60) x 2000] / (8 x 215)  = 1700 / 1720 

Utilization = 0.9884   

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6 0
3 years ago
A homeowner paid $85,000 for a house three years ago. The house sells today for $110,000. How much has the property appreciated?
Dima020 [189]

Answer:

Option (a) is correct.

Explanation:

Amount paid for house three years ago = $85,000

Selling price of house today = $110,000

Therefore,

Property appreciated by following percentage:

= (change in value ÷ Amount paid for house three years ago) × 100

= [($110,000 - $85,000) ÷ $85,000] × 100

= ($25,000 ÷ $85,000) × 100

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6 0
3 years ago
Tom produces commemorative t-shirts in a competitive market. if tom decides to decrease his output, this will
wolverine [178]

In a competitive market, a large number of producers compete with each other to satisfy the needs of their consumers. In here, no one or group of producers can dictate the price.  <span>They have only one major decision to make—and that is, what quantity to produce.  Therefore, when Tom decided to produce commemorative t-shirts, and decrease his output, This decision did not increase his revenue, since did not lead to higher market price nor the competitors will decrease their output. </span><span> The answer is C. decrease his revenue, for price remains the same.</span>

6 0
3 years ago
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Dr. G, the principal at Westside High School Academy, is worried that the students who win academic awards might also be more li
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Explanation:

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Winner of academic awards- 128

Winner of fine arts awards- 48

Students who won both awards- 8

Dr G pre assumption= Dr G was worried that winner of academic awards would win fine awards more likely.

But it seems that his assumtions are wrong since only 8 students out of 128 students won joint awards (meaning only 8 students won awards for fine arts as well as academic awards). Similarly, this corresponds to only 0.0625% of students winning academic awards as well as Fine arts awards.

8 0
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Answer
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3 0
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