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

Prepare journal entries to record the borrowing, On December 1, 2013, Colon...

On December 1, 2013, Colonel Wilder borrowed $400,000 at 12% interest and pledged $500,000 in accounts receivable as collateral. Additionally, Colonel Wilder was charged a finance

Format of the balance sheet, Format of the Balance Sheet It shows the f...

Format of the Balance Sheet It shows the financial position of the company as at the end of a given financial period. The standard requires that assets and liabilities should b

Calculate the npv for the purchase, 1. Lease vs. Buy Trasky Company is t...

1. Lease vs. Buy Trasky Company is trying to decide whether it should purchase or lease a new automated machine to be used in the production of a new product. If purchased, the

Record performance of the services, Robin Corporation accepted credit cards...

Robin Corporation accepted credit cards for $34,200 of services performed in October 2011.The credit card company charged a 3% service fee and paid Robin as soon as it received the

Business, #Which of the two ratios are the greatest? 1.67.1 or 0.29.1

#Which of the two ratios are the greatest? 1.67.1 or 0.29.1

Financial break , OCF 218200 will result in a zero net present value for th...

OCF 218200 will result in a zero net present value for the project. The FC 329000 and CM 216.4 per unit. Financial break even?

Interest-probable debts, Interest Interest may be claimed-up to the dat...

Interest Interest may be claimed-up to the date of the receiving order - if it is payable: By agreement; By statute; If the debt was created in writing and due at a

Calculate the var, An investment has a 92% chance of making a profit of $10...

An investment has a 92% chance of making a profit of $10 million, a 1.5% chance of losing $4 million, a 3% of losing $6 million, and a 3.5% chance of losing $16 million. A)    W

Draw budget constraint - budget line, You will gain welfare from consuming ...

You will gain welfare from consuming bread and chocolate. Your welfare is described numerically by W = 4B + 2C, where B denotes the quantity of bread you choose to consume, and C d

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