Reference no: EM13482326

Jorge Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 50 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2014, management estimates the following revenues and costs.

Prepare a CVP income statement for 2014 based on managemental estimates.

• Sales 1,800,000
• direct materials 430,000
• direct labor 360,000
• manufacturing overhead- variable 380,000
• manufacturing overhead- fixed 280,000
• Selling expenses- variable 70,000
• Selling expenses- fixed 65,000
• Administrative expenses- 20,000
• Administrative expenses- 60,000

1. calculate the variable cost per bottle. -round to 2 decimal places
2. Compute the break-even point in (1) units and (2) dollars. -round to 0 decimal places
3. Compute the contribution margin ratio and the margin of safety ratio. -round to 2 decimal places
4. Determine the sales dollars required to earn net income of $180,000. -round to 0 decimal places