E6-3 (Algo) Determining Break-Even Point, Target Profit, Margin of Safety [LO 6-1, 6-2, 6-3] Cove's Cakes is a local bakery. Price and cost information follows: Price per cake Variable cost per cake Ingredients Direct labor Overhead (box, etc.) Fixed costs per month Required: $ 13.71 2.26 1.13 0.24 3,628.80 1. Determine Cove's break-even point in units and sales dollars. 2. Determine the bakery's margin of safety in sales dollars if it currently sells 430 cakes per month. 3. Determine the number of cakes that Cove must sell to generate $2,700 in profit.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question
E6-3 (Algo) Determining Break-Even Point, Target Profit, Margin of Safety [LO 6-1, 6-2, 6-3]
Cove's Cakes is a local bakery. Price and cost information follows:
Price per cake
Variable cost per cake
Ingredients
Direct labor
Overhead (box, etc.)
Fixed costs per month
Required:
$ 13.71
2.26
1.13
0.24
3,628.80
1. Determine Cove's break-even point in units and sales dollars.
2. Determine the bakery's margin of safety in sales dollars if it currently sells 430 cakes per month.
3. Determine the number of cakes that Cove must sell to generate $2,700 in profit.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2 Required 3
Determine Cove's break-even point in units and sales dollars.
Note: Round your Break-Even Units answer to the nearest whole number. Round your other intermediate calculations and
sales dollars answer to 2 decimal places.
Break-Even Units
Break-Even Sales Dollars
Cakes
Required 1
Required 2 >
Transcribed Image Text:E6-3 (Algo) Determining Break-Even Point, Target Profit, Margin of Safety [LO 6-1, 6-2, 6-3] Cove's Cakes is a local bakery. Price and cost information follows: Price per cake Variable cost per cake Ingredients Direct labor Overhead (box, etc.) Fixed costs per month Required: $ 13.71 2.26 1.13 0.24 3,628.80 1. Determine Cove's break-even point in units and sales dollars. 2. Determine the bakery's margin of safety in sales dollars if it currently sells 430 cakes per month. 3. Determine the number of cakes that Cove must sell to generate $2,700 in profit. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine Cove's break-even point in units and sales dollars. Note: Round your Break-Even Units answer to the nearest whole number. Round your other intermediate calculations and sales dollars answer to 2 decimal places. Break-Even Units Break-Even Sales Dollars Cakes Required 1 Required 2 >
Expert Solution
steps

Step by step

Solved in 5 steps

Blurred answer
Knowledge Booster
Cost control
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education