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Prepare a contribution margin income statement for month

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Question 1. A company sells mulch by the cubic yard. Grade A much sells for $150 per cubic yard and has variable costs of $65 per cubic yard. The company has fixed expenses of $15,000 per month. In August, the company sold 240 cubic yards of Grade A mulch.

a. Calculate the contribution margin per unit for Grade A mulch.

b. Calculate the contribution margin ratio of the Grade A mulch.

c. Prepare a contribution margin income statement for the month of August.

Question 2. A company manufactures and sells blades that are used in riding lawnmowers. The 18-inch blade sells for $15 and has per-unit variable costs of $4 associated with its production. The company has fixed expenses of $85,000 per month. In January, the company sold 12,000 of the 18-inch blades.

a. Calculate the contribution margin per unit for the 18-inch blade.

b. Calculate the contribution margin ratio of the 18-inch blade.

c. Prepare a contribution margin income statement for the month of January.

Reference no: EM132609428

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