Mechem Corporation produces and sells a single product. In April, the company sold 2,000 units. Its total sales were $160,000, its total variable expenses were $78,600, and its total fixed expenses were $55,500. Required: a. Construct the company's contribution format income statement for April. b. Redo the company's contribution format income statement assuming that the company sells 1,900 units. Complete this question by entering your answers in the tabs below. Required a Required b Construct the company's contribution format income statement for April. (Do not round intermediate calculations.) $ 0 0 < Required a Required b >

Mechem Corporation produces and sells a single product. In April, the company sold 2,000 units. Its total sales were $160,000, its total variable expenses were $78,600, and its total fixed expenses were $55,500. Required: a. Construct the company's contribution format income statement for April. b. Redo the company's contribution format income statement assuming that the company sells 1,900 units. Complete this question by entering your answers in the tabs below. Required a Required b Construct the company's contribution format income statement for April. (Do not round intermediate calculations.) $ 0 0 < Required a Required b >

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 6EB: Kerr Manufacturing sells a single product with a selling price of $600 with variable costs per unit...

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Ellerson Company provided the following information for the last calendar year: During the year, direct materials purchases amounted to 278,000, direct labor cost was 189,000, and overhead cost was 523,000. During the year, 100,000 units were completed. Refer to Exercise 2.21. Last calendar year, Ellerson recognized revenue of 1,312,000 and had selling and administrative expenses of 204,600. Required: 1. What is the cost of goods sold for last year? 2. Prepare an income statement for Ellerson for last year.
West Island distributes a single product. The companys sales and expenses for the month of June are shown. Using the information presented, answer these questions: A. What is the break-even point in units sold and dollar sales? B. What is the total contribution margin at the break-even point? C. If West Island wants to earn a profit of $21,000, how many units would they have to sell? D. Prepare a contribution margin income statement that reflects sales necessary to achieve the target profit.
Use the following information for Brief Exercise: Morning Smiles Coffee Company manufactures Stoneware French Press coffee makers and sold 8,000 coffee makers during the month of March at a total cost of 612,500. Each coffee maker sold at a price of 100. Morning Smiles also incurred two types of selling costs: commissions equal to 5% of the sales price and other selling expense of 45,000. Administrative expense totaled 47,500. 2-33 Income Statement Percentages Refer to the information for Morning Smiles Coffee Company on the previous page. Required: Prepare an income statement for Morning Smiles for the month of March and calculate the percentage of sales revenue represented by each line of the income statement. (Note: Round answers to one decimal place.)
A company sells small motors as a component part to automobiles. The Model 101 motor sells for $850 and has per-unit variable costs of $400 associated with its production. The company has fixed expenses of $90,000 per month. In August, the company sold 425 of the Model 101 motors. A. Calculate the contribution margin per unit for the Model 101. B. Calculate the contribution margin ratio of the Model 101. C. Prepare a contribution margin income statement for the month of August.
A company manufactures and sells blades that are used in riding lawnmowers. The 18-inch blade sells for $15 and has per-unit variable costs of $4 associated with its production. The company has fixed expenses of $85,000 per month. In January, the company sold 12,000 of the 18-inch blades. A. Calculate the contribution margin per unit for the 18-inch blade. B. Calculate the contribution margin ratio of the 18-inch blade. C. Prepare a contribution margin income statement for the month of January.
Western Trucking operates a fleet of delivery trucks. The fixed expenses to operate the fleet are $79,900 in March and rose to $93,120 in April. It costs Western Trucking $0.15 per mile in variable costs. In March, the delivery trucks were driven a total of 85,000 miles, and in April,. they were driven a total of 96,000 miles. Using this information, answer the following: A. What were the total costs to operate the fleet in March and April, respectively? B. What were the cost per mile to operate the fleet in March and April, respectively?
Cadre, Inc., sells a single product with a selling price of $120 and variable costs per unit of $90. The companys monthly fixed expenses are $180,000. What is the companys break-even point in units? What is the companys break-even point in dollars? Prepare a contribution margin income statement for the month of October when they will sell 10,000 units. How many units will Cadre need to sell in order to realize a target profit of $300,000? What dollar sales will Cadre need to generate in order to realize a target profit of $300,000? Construct a contribution margin income statement for the month of August that reflects $2,400,000 in sales revenue for Cadre, Inc.
Fresno Industries Inc. manufactures and sells high-quality camping tents. The company began operations on January 1 and operated at 100% of capacity (150,000 units) during the first month, creating an ending inventory of 20,000 units. During February, the company produced 130,000 units during the month but sold 150,000 units at 500 per unit. The February manufacturing costs and selling and administrative expenses were as follows: a. Prepare an income statement according to the absorption costing concept for the month ending February 28. b. Prepare an income statement according to the variable costing concept for for the month ending February 28. c. What is the reason for the difference in the amount of operating income reported in (a) and (b)?
Melchar Company uses 78,125 pounds of oats each year. The cost of placing an order is 18, and the carrying cost for one pound of oats is 0.45. Required: 1. Compute the economic order quantity for oats. 2. Compute the carrying and ordering costs for the EOQ.
Colonels uses a traditional cost system and estimates next years overhead will be $480,000, with the estimated cost driver of 240,000 direct labor hours. It manufactures three products and estimates these costs: If the labor rate is $25 per hour, what is the per-unit cost of each product?
Markham Farms reports the following contribution margin income statement for the month of August. The company has the opportunity to purchase new machinery that will reduce its variable cost per unit by $2 but will increase fixed costs by 15%. Prepare a projected contribution margin income statement for Markham Farm assuming it purchases the new equipment. Assume sales level remains unchanged.
Starling Co. manufactures one product with a selling price of 18 and variable cost of 12. Starlings total annual fixed costs are 38,400. If operating income last year was 28,800, what was the number of units Starling sold? a. 4,800 b. 6,400 c. 5,600 d. 11,200