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Levart [38]
3 years ago
8

Break-Even Units, Contribution Margin Ratio, Multiple-Product Breakeven, Margin of Safety, Degree of Operating Leverage Jellico

Inc.'s projected operating income (based on sales of 450,000 units) for the coming year is as follows: Total Sales $11,700,000 Total variable cost 8,190,000 Contribution margin $3,510,000 Total fixed cost 2,254,200 Operating income $1,255,800 Required: 1(a). Compute variable cost per unit. Round your answer to the nearest cent. $ per unit 1(b). Compute contribution margin per unit. Round your answer to the nearest cent. $ per unit 1(c). Compute contribution margin ratio. % 1(d). Compute break-even point in units. units 1(e). Compute break-even point in sales dollars. $ 2. How many units must be sold to earn operating income of $296,400
Business
1 answer:
MakcuM [25]3 years ago
8 0

Answer:

A)VCPU = VC / UNITS

$8,190,000 / 450,000

=$18.20

B)CONTRIBUTION MARGIN PER UNIT =$ 3,510,000 / 450,000

=$7.80

C)CONTRIBUTION MARGIN RATIO = CONTRIBUTION / SALES

=>30%

D)SALES PRICE = $26

BEP IN UNITS = FC / CONTRIBUTION PER UNIT

= $2254200 / $7.8

=289,000 UNITS

BEP IN $ = FC / PV RATIO

=$2254200 / 30%

= $7,514,000

2 A) SALES REQUIRED = (FC + DESIRED PROFIT ) / PV RATIO

= $(2254200 + 296,400) / 30%

=$8,502,000 / 26

=$327,000units

Explanation:

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Amiraneli [1.4K]

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Then, in our question we have:

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Why is it called elasticity of demand?

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