Summer Nights sells bottles of bug spray for $ 9.00 each. Variable costs are $ 4.00 per bottle, while fixed costs are $ 40 comm

Question

3 years ago

7

Summer Nights sells bottles of bug spray for $ 9.00 each. Variable costs are $ 4.00 per bottle, while fixed costs are $ 40 comm

a 000 per month for volumes up to 40 comma 000 bottles of spray and $ 58 comma 000 per month for volumes above 40 comma 000 bottles of spray. The flexible budget would reflect monthly operating income for 23 comma 000 bottles of spray and 31 comma 000 bottles of spray of what dollar amounts?

Business

1 answer:

Yanka [14] · Answer 1 · 2022-05-18T00:13:40+03:00

Answer:

Operating Income $75,000 $115,000

Explanation:

The computation of the operating income reflected is shown below:

Units 23,000 $31,000

Contribution Margin per Unit $5 $5

Contribution Margin (Units × Per Unit) $115,000 $155,000

Less : Fixed Cost -$40,000 -$40,000

Operating Income $75,000 $115,000

The contribution margin per unit is come from

= Selling price per unit - variable cost per unit

= $9 - $4

= $5

Summer Nights sells bottles of bug spray for $ 9.00 each. Variable costs are $ 4.00 per​ bottle, while fixed costs are $ 40 comm

Summer Nights sells bottles of bug spray for $ 9.00 each. Variable costs are $ 4.00 per bottle, while fixed costs are $ 40 comm