During its most recent fiscal year, Simon Enterprises sold 200,000 electric screwdrivers at a price of $15 each. Fixed costs amo

Question

3 years ago

8

During its most recent fiscal year, Simon Enterprises sold 200,000 electric screwdrivers at a price of $15 each. Fixed costs amo

unted to $400,000 and pretax income was $600,000. What amount should have been reported as variable costs in the company's contribution margin income statement for the year in question?

Business

2 answers:

Grace [21] · Answer 1 · 2022-01-29T07:12:51+03:00

Grace [21]3 years ago

8 0

Answer:

Sales-VC=Contribution

Contribution-FC=600000

Contribution=1000000

Sales-VC=1000000

VC=200000*15-1000000

VC=2000000

d. $2,000,000.

Explanation:

Vikentia [17] · Answer 2 · 2022-01-29T05:55:45+03:00

Answer:

$2,000,000

Explanation:

We know that,

Pre-tax income = Sales - variable cost - fixed cost

where,

Sales = Number of units sold × selling price per unit

= 200,000 units × $15

= $3,000,000

And, the other items values remain the same

Now put these values to the above formula

So, the value would be equal to

$600,000 = $3,000,000 - variable cost - $400,000

So, the variable cost = $2,000,000