Based on the fixed costs of the Rocky Mountain Bottling Company, the contribution margin per unit is $0.40 per unit
<h3>How is the contribution margin found?</h3>
First, find the variable costs:
= 300,000 + (250,000 - 70,000)
= $480,000
The contribution margin per unit is:
= (Sales - variable costs) / number of units
= (800,000 - 480,000) / 800,000
= $0.40 per unit
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Answer:
$202,409
Explanation:
Firstly, we will need to calculate Break even in sales dollar for division Q using the formula;
= Division Q fixed cost / contribution margin ratio
Division Q fixed cost = $89,060
But,
Contribution margin ratio = Contribution margin / Sales
Contribution margin ratio = $161,920 / $368,000
Contribution margin ratio = 44%
Therefore, the Break even in sales dollar for Division Q
= $89,060 / 44%
= $202,409
The Break even in sales dollars for Division Q is closest to $202,409
In order to achieve its goal, the amount the firm should save each quarter is $56,033.97
The formula that can be used to determine the amount that the company should save every month to achieve its goal is :
Amount = future value / annuity factor
Annuity factor = 
- Future value = amount it wants to save in 4 years = $1 million
- r = interest rate = 5.75% / 4 = 1.4375%
- n = number of years = 4 x 4 = 16
Annuity factor = [(1 + 0.014375)^16 - 1] / 0.014375
= 17.846317
Amount = $1,000,000 / 17.846317
= $56,033.97
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Answer:
The correct answer is C. are incurred even if nothing is produced.
Explanation:
Fixed costs are the cost of an organization that don´t change with the amount of production. So , if the production is 0, this cost will exist anyway. For example: taxes, rental
Then, Fixed costs can be defined as costs that are incurred even if nothing is produced.
