Hermosa, Inc., produces one model of mountain bike. Partial information for the company follows:                    Number of bikes produced and sold   490   830   970 Total costs             Variable costs $ 113,190 $ ? $ ? Fixed costs per year   ?   ?   ? Total costs   ?   ?   ? Cost per unit             Variable cost per unit   ?   ?   ? Fixed cost per unit   ?   ?   ? Total cost per unit   ? $ 507.75   ?     Required:1. Complete the table. 2. Calculate Hermosa’s contribution margin ratio and its total contribution margin at each sales level indicated in the table assuming the company sells each bike for $730. 4. Calculate Hermosa’s break-even point in units and sales revenue.

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter16: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 20E
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Hermosa, Inc., produces one model of mountain bike. Partial information for the company follows:

 

                
Number of bikes produced and sold   490   830   970
Total costs            
Variable costs $ 113,190 $ ? $ ?
Fixed costs per year   ?   ?   ?
Total costs   ?   ?   ?
Cost per unit            
Variable cost per unit   ?   ?   ?
Fixed cost per unit   ?   ?   ?
Total cost per unit   ? $ 507.75   ?
 

 

Required:
1. Complete the table.

2. Calculate Hermosa’s contribution margin ratio and its total contribution margin at each sales level indicated in the table assuming the company sells each bike for $730.

4. Calculate Hermosa’s break-even point in units and sales revenue.

 

 

 

 

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