Calculate the contribution margin ratio

Assignment Help Finance Basics

Reference no: EM1348642

Rock is sold to contractors who use the product in construction projects. Needs to increase sales by advertising. Spend $100,000 advertising campaign. currently sells 25,000 tons for a total revenue of $5,000,000.
Direct Labor...............$1,500,000
Variable production overhead...........200,000
fixed production overhead.................350,000

Selling and admministrative expenses
Variable...................................50,000
fixed........................................300,000
a. Compute break-even point in units (i.e. tons)
b. Compute the contribution margin ratio
c. will spend $100,000 on advertising and the company expects the advertising to increase sales by $200,000. Should the company increase advertising and Why?

Reference no: EM1348642

Questions Cloud

Find the overall magnification of the friend : Visitors at a science museum are invited to sit in a chair to right of a full-length diverging lens (f1 = -3.06 m) and observe a friend sitting in a second chair, 1.84m to the left of the lens.

Seasonal affective disorder : I found it very interesting what you wrote Seasonal Affective Disorder (SAD), I made me think about myself. Every year around the month of September I began to get really depressed.

Personality and employee interpersonal relations : How can knowledge of each personality factor help a person form better interpersonal relationships on the job? Do you feel personality is important in interpersonal relations

Cash conversion cycle-operating cycle : Calculate the firm's cash conversion cycle. Calculate the firm's operating cycle Calculate the daily expenditure and the firm's annual savings if the operating cycle is reduced by 15 days.

Calculate the contribution margin ratio : Rock is sold to contractors who use the product in construction projects. Requires to increase sales by advertising. Spend $100,000 advertising campaign. Calculate the contribution margin ratio

Find out amount of access that new user needs : As a security manager for XYZ Corporation, you are asked to find out amount of access that new user needs. You contact user and ask them to help you understand what kind of access they need.

Personality traits - malleable or stable : Can an introverted person with average charisma and personality ever hope to achieve characteristics that would lead to their being described as a great leade

Short statement on mood swings : When a condition has serious effects on an individual, sometimes their life is changed to where they can hold the traditional roles of supporting themselves. At what point, if ever, should the government step in financially?

Illustrate what would need to reduce the supply of money : illustrate what would need to reduce the supply of money if Canada was an open economy with a flexible exchange rate.

User Account

All Pages