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Income statement of manufacturing operations Units $
Sales 360,000 7,500,000
Variable cost 3,500,000
Contribution Margin 4,000,000
Fixed Expenses 2,500,000
Net profit 1,500,000
Problem 1: Calculate the Sales price, Contribution margin and Variable Expenses (all per unit).
Problem 2: Calculate the company's contribution margin ratio.
Problem 3: Calculate the company's BEP in units & dollars.
Problem 4: Calculate the margin of safety for this company. Budgeted Sales - $8,500,000.
Problem 5: Assume that management wants a $2,000,000 profit next year. How many production units must be sold to reach this goal?
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Determine the company's bid if activity-based costing is used and the bid is based upon full manufacturing cost plus 30 percent.
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This individual assignment is based on the TerraCycle Inc.
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A new plant accountant suggested that the company may be able to assign support costs to products more accurately by using an activity based costing system that relies on a separate rate for each manufacturing activity that causes support costs.
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