Contribution margin ratio-breakeven point in total revenue

Assignment Help Financial Accounting

Reference no: EM131287009

ABC Compagny is selling the unit of final product for $70. The projected income statement for 2014 follows:

Sales $4,000,000

Variable costs (2,000,000)

Contribution Margin 2,000,000

Fixed costs (1,500,000)

Pretax profit $ 500,000

a. Compute the contribution margin per unit and the number of units that must be sold to break even.

b. Compute the contribution margin ratio and the breakeven point in total revenue (in $).

c. What is the margin of safety in number of units?

d. Assume a tax rate of 25%. How many units must be sold to earn an after-tax profit of $300,000?

Reference no: EM131287009

Questions Cloud

Determine the stiffness matrix for the bar element : Determine the stiffness matrix for the bar element with end nodes and midlength node shown in Figure.- Let axial displacement u = a1 + a2x + a3x2.

Determine the largest p : A machine operator produces the tension T in the control rod by applying the force P to the foot pedal. Determine the largest P if the magnitude of the pin reaction at B is limited to 1.8 kN. Neglect the mass of the mechanism.

Substitute for management : "Budget is an aid to management and not a Substitute for management".

Advantages does a cio bring to a business : What advantages does a CIO bring to a business? What might be the disadvantages of having a CIO?

Contribution margin ratio-breakeven point in total revenue : ABC Compagny is selling the unit of final product for $70. The projected income statement for 2014 follows: Compute the contribution margin per unit and the number of units that must be sold to break even. Compute the contribution margin ratio and th..

Performance measurement and control : (a) Discuss how the project closure review differs from a performance measurement and control that occurs throughout the life of the project.

Displacement function for the two noded bar element : Consider the following displacement function for the two-noded bar element:- Is this a valid displacement function? Discuss why or why not.

Change management and contingency planning : Change Management and Contingency planning are two central elements of managing risk in projects. Using suitable examples, explain both of these concepts.

Compute the weight of the chassis and the weight of the tray : When the tray is in the raised position, the rear axle load increases to 48 700 lb. Compute the weight of the chassis, the weight of the tray, and the distance x.

User Account

All Pages