User Account

All Pages

Compute the contribution margin ratio

Assignment Help Managerial Accounting
Reference no: EM133044299

Question - Bonanza Company is in business since last many years, which is manufacturing swimming suits for professionals. Analysis of the company's financial record for the current year indicates the following:

Average Selling price per swim suit Rs. 700

Variable cost per swim suit:

Direct material Rs. 280

Direct Labour Rs. 120

Variable Overheads Rs. 55

Annual fixed cost:

Administrative Rs. 250,000

Selling Rs. 100,000

Required -

a. Compute the contribution margin ratio and contribution margin per unit.

b. Compute the breakeven sales revenues and breakeven sales in units.

c. If the company desires to earn a profit of Rs. 210,000 per annum, compute the sales revenues and sale units to achieve the target profit.

The company is considering to purchase a faster sewing machine that will save Rs. 35 per swim suit in labour cost but will raise annual fixed cost by Rs. 50,000 on depreciation. The new sewing machine requires capital investment of Rs. 500,000 and has 10 years useful life. Should the company switch over to new sewing machine? Draw your recommendations supported by statistical computation.

Reference no: EM133044299

Questions Cloud

Orientation and training of employees of diverse cultures : Create as an APA essay a scenario in which you are the administrator of a new company. Choose the type of company you like (specifying the name of the company a
Useless positive reinforcement : In a personal opinion, what is the fine line between too much and useless positive reinforcement and authentic and practical positive reinforcement while promot
Presentation of project plan and status : Presentation of project plan and status to a sponsor for a project case Assessment - Complete the Project Scope Statement for this Project
Advantages and Nature vs. Nurture??????? : To what degree do you think the creativity of an organization is a function of the creativity of the employees themselves, rather than the structure
Compute the contribution margin ratio : Bonanza Company is in business since last many years, which is manufacturing swimming suits for professionals. Compute the contribution margin ratio
IT Strategic Planning : What elements of IT are not considered infrastructure? What are the stages of executing a technology budget?
What is the impact on the balance sheet : What is the impact on the balance sheet after the necessary adjustments are made according to book value accounting
Business impact analysis-business continuity plan : Senior management at Health Network has decided they want a business impact analysis (BIA) that examines company's data center and a business continuity plan.
Strategic thinking and business acumen : Workforce planning is an area that requires strategic thinking and business acumen. Let's start by looking outside for examples to assess business strategies an

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Manage budgets and financial plans

Explain the budgeting process and its importance to a business, identifying the components of different budgets, forecast estimates for inclusion in the budgets.

  Prepare a retained earnings statement

Prepare a retained earnings statement for the year and Prepare a stockholders' equity section of given case.

  Prepare a master budget for the three-month period

Prepare a master budget for the three-month period.

  Construct the companys direct labor budget

Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.

  Evaluate the predetermined overhead rate

Evaluate the Predetermined Overhead Rate

  Determine the company''s bid

Determine the company's bid if activity-based costing is used and the bid is based upon full manufacturing cost plus 30 percent.

  Compute the pool rates for the different activities

Complete the schedule to compute the pool rates for the different activities.

  Prepare Company financial statements

Prepare Company financial statements

  Prepare an analysis of terracycles

This individual assignment is based on the TerraCycle Inc.

  Discuss the ethical issues

Discuss the ethical issues

  Political resources in emerging markets

Calculate the GDP in Income Approach  and Expenditure Approach

  Management accounting - ehsan electronics company

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.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd