1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
elena-s [515]
4 years ago
10

Last month, Laredo Company sold 650 units for $125 each. During the month, fixed costs were $8,850 and variable costs were $75 p

er unit. Required: 1. Determine the unit contribution margin and contribution margin ratio. 2. Calculate the break-even point in units and sales dollars. 3. Compute Laredo’s margin of safety in units and as a percentage of sales.
Business
1 answer:
Y_Kistochka [10]4 years ago
3 0

Answer:

1. $50 and 40%

2. 177 units and $22,125

3. 473 units and 72.77%

Explanation:

Price = $125

Variable cost = $75

Fixed cost =$8,850

Contribution margin is the net of sales price and variable cost of the product. It is the cost available to recover the fixed cost and make profit afterward.

1. Contribution margin = Sales price - Variable cost = $125 - $75 = $50

Contribution margin ratio = Contribution margin / Sale price = $50 / $125 = 40%

Break-even is the level of sales at which business has no profit no loss situation.

2. Break-even point = Fixed cost / Contribution margin per unit = $8,850 / $50 = 177 units

Break-even in $ = 177 units x $125 = $22,125

Margin of safety is the level of sales at which the business is safe from making loss. Margin of safety measures the profit after the break-even point.

3. Margin of Safety = Total sales - Break-even point = 650 units - 177 units = 473 units

Margin of safety to sales = ( Margin of safety / Total sales ) = ( 473 units / 650 units ) x 100 = 72.77%

You might be interested in
Which of the following is least important as a consideration for a firm at the beginning of a supply chain? access to end consum
Anuta_ua [19.1K]

Answer:

access to end consumers

Explanation:

Handling the supply chain relates to handling the day-to-day operations related to the product and services.  

The goal is to turn the raw material into the finished products by going through the process work cycle so that the product is ready to be sold and shipped to the consumer with prescribed time and exact location.  

In turn, it also focuses on achieving a competitive advantage and improving client satisfaction.

At the beginning of the supply chain, they less focus to the end consumers.

6 0
3 years ago
Sue works as a salesperson in a clothing store. She earns $7.25 per hour plus _____, which is based on her sales revenue. a base
mezya [45]
Sue works as a salesperson in a clothing store. She earns $7.25 per hour plus COMMISSION, which is based on her sales revenue.

Types of Sales Commissions:
1) Gross profit commission - based on gross profit (sales - cost)
2) Revenue Commission  ⇒ Sue's commission
3) Placement Fees - fixed amount on every unit sold
4) Revenue Gates - based on performance
3 0
3 years ago
Read 2 more answers
Under a municipal revenue bond rate covenant, rates must be set to cover all :_________
stepan [7]

Answer:

D. optional sinking fund deposits

Explanation:

The revenue bond rate convenants needed that the rate should be set for the level that could be enough for covering a facility operation and maintenance also the debt service cost is considered

But there is no requirement to cover the option sinking fund or the deposit with respect to the reserve fund

Therefore according to the given case, the option D should be chosen

7 0
3 years ago
Mcmurtry Corporation sells a product for $170 per unit. The product's current sales are 10,000 units and its break-even sales ar
Vlad1618 [11]

Answer:

19%

Explanation:

Margin of safety = (Current sales - Break even sales) / Current sales * 100

= (10,000 - 8,100) /10,000 *100

= 1,900 / 10,000 * 100

= 19%

4 0
4 years ago
William Parks, a special agent of the U.S. Customs Service, was investigating allegations that Bet-Air, Inc. (a seller of spare
grandymaker [24]

Answer:

The appellate court did not rule in favor of Hall.  Instead, it upheld the lower court's rulings.  When Hall appealed up to the Supreme Court, the highest court affirmed Hall's conviction and sentencing.

This shows that there was no violation of the Fourth Amendment in Hall's case.  In addition, the prosecution established the existence of probable cause in the absence of a valid warrant to search and obtain evidence that would establish the case against Terrence Hall, leading to his eventual conviction.

Explanation:

Although, the Fourth Amendment of the US Constitution protects an individual from unreasonable searches and seizures by the government, it does not guarantee against all searches and seizures.  It only guarantees against searches and seizures that are regarded as legally unreasonable.  This implies that there may be probable cause for searches and seizures.

5 0
3 years ago
Other questions:
  • Forever Jewelers uses the perpetual inventory system. On April​ 2, Forever sold merchandise with a cost of $ 1 comma 500$1,500
    11·1 answer
  • University Company produces collegiate apparel. From its accounting records, it prepares the following schedule and financial st
    15·1 answer
  • which function would be used to remove a section pf text from a document? A.cut B.copy C.paste D.undo
    10·1 answer
  • Jared, the operations head at cerise confectionery, showed gratitude to his employees by hosting an employee appreciation day. i
    10·1 answer
  • Because private owners are held responsible for damages their property causes to the property of others, private owners have
    9·2 answers
  • Marvel Company uses a predetermined overhead rate in applying overhead to production orders on a labor-cost basis in Department
    8·1 answer
  • If a regulatory commission imposes upon a nondiscriminating natural monopoly a price that is equal to marginal cost and below av
    9·1 answer
  • Gruden Company produces golf discs which it normally sells to retailers for $7 each. The cost of manufacturing 20,000 golf discs
    9·1 answer
  • Another term for "food poisoning" is?
    7·2 answers
  • Which sentence in the passage refers to the "analysis" of a given problem?
    7·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!