ABC Corp has the following information: Number of units: 3600 Sales Price per Unit $50 Variable Cost perUnit 10 Total Fixed Costs 80000 Target Operating Income 100000 Calculate: Contribution Margin per Unit Contribution Margin Ratio Breakeven point in Units Breakeven point in sales dollars Units to achieve target operating income
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
ABC Corp has the following information:
Number of units: 3600
Sales Price per Unit $50
Variable Cost perUnit 10
Total Fixed Costs 80000
Target Operating Income 100000
Calculate:
Contribution Margin per Unit
Contribution Margin Ratio
Breakeven point in Units
Breakeven point in sales dollars
Units to achieve target operating income
Trending now
This is a popular solution!
Step by step
Solved in 5 steps with 5 images
