calculate a weighted average contribution margin per unit, Financial Accounting

Assignment Help:

Part A

 The contribution margin income statement of Nice Cup Company for 31 December 2011 follows:

Nice Cup Company

 

Contribution Margin Income Statement

 

Year Ended December 31, 2011

 

 




RM

RM


Sales revenue

 

 127,000

 

Variable costs:

 

 

 

Cost of goods sold

 32,400

 

 

Marketing costs

 17,300

 

 

General and administrative costs

10,625

60,325

 

Contribution margin

 

66,675

 

Fixed costs:

 

 

 

Marketing costs

56,700

 

 

General and administrative costs

6,300

63,000

 

Operating income

 

 3,675

 

Nice Cup Company sells two dozen of chocolate cupcake for every dozen of blueberry cupcake. A dozen chocolate cup cake plain donuts sells for RM6, with total variable cost of RM2 per dozen. A dozen blueberry cupcake sells for RM8, with total variable cost of RM5.50 per dozen.

REQUIRED

a) Determine Nice Cup Company's monthly breakeven point in dozens of chocolate cupcake and blueberry flavor cupcake. Prove your answer by preparing a summary contribution margin income statement at the breakeven level of sales.

b) Compute Nice Cup Company's margin of safety in value for December 2011.

c) If Nice Company can increase monthly sales volume by 10%, what will operating income be? (The sales mix remains unchanged.)

Part B

a) Explain the term sales mix in your own words. How does sales mix affect the contribution margin?

b) Explain how to calculate a weighted average contribution margin per unit.


Related Discussions:- calculate a weighted average contribution margin per unit

Balance sheet preparation with a missing element, Balance Sheet Preparation...

Balance Sheet Preparation with a Missing Element The following data are available for Schubert Products Inc. as of December 31, 2012. Cash . . . . . . . . . . . . . . . . . . . . .

Illustrations of accounting policies-financial statement, Illustrations of ...

Illustrations of Accounting Policies A Ltd., has decided to change its policy of writing off borrowing costs to capitalizing the same. As at 31st December, 2003, the company had

As an asset-survivorship policy, As an asset The argument for this stat...

As an asset The argument for this statement is that the survivorship policy is an investment because eventually the partnership will receive either the surrender value or the s

The opening entries-executorship laws and accounts, The opening entries 1...

The opening entries 1. Assets of the estate or trust In both cases the various assets of the estate or trust are debited to appropriate accounts and credited to the Estate Ca

UNDERSTANDING bUSINESS, I NEED HELP in business ratios for two company.Ido...

I NEED HELP in business ratios for two company.Ido not know how to do the formulas. Can you help.

Leslie, My trial balance is off by $304 and I can''t find my error

My trial balance is off by $304 and I can''t find my error

What do you mean by married taxpayers, Q. What do you mean by Married Taxpa...

Q. What do you mean by Married Taxpayers? Married Taxpayers - Taxpayers who are married may file a JOINT RETURN, thus combining their INCOME and expenses. Individuals would be

Mini-max system, In this method the minimum and maximum level for all items...

In this method the minimum and maximum level for all items of inventory are fixed. These levels function as an origin for initiating action so that the quantity of all items is con

Write Your Message!

Captcha
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!

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