Solution-T-shirts are sold next mont

T-shirts are sold next mont

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Reference no: EM13655498

Arlo's T-shirt Shop only has three costs: T-shirt cost, rent cost on the shop, and utilities cost. Arlo's sells the T-shirt for $14.50 each. Management has prepared the following estimated cost information for next month:

	At 8,000	At 10,000
	T-shirts	T-shirts
T-shirt cost	$48,000	$60,000
Rent cost	$3,600	$3,600
Utilities cost	$6,800	$8,300

Assume that all of the activity levels mentioned in this problem are within the relevant range.

Required:

a. Calculate what Arlo's should expect for total variable cost if 9,000 T-shirts are sold next month.

b. Prepare Arlo's contribution approach income statement for a monthly sales volume level of 10,000 T-shirts.

Reference no: EM13655498

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T-shirts are sold next mont

Reference no: EM13655498

Reference no: EM13655498

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