MANAGERIAL ACCT.-WILEYPLUS BLKBRD PKG
7th Edition
ISBN: 9781118869765
Author: Weygandt
Publisher: WILEY
expand_more
expand_more
format_list_bulleted
Videos
Textbook Question
Chapter 5, Problem 5.2AP
Jorge Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 50 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2017, management estimates the following revenues and costs.
Instructions
(a) Prepare a CVP income statement for 2017 based on management's estimates. (Show column for total amounts only.)
(b) Compute the break-even point in (1) units and (2) dollars.
(c) Compute the contribution margin ratio and the margin of safety ratio. (Round to nearest full percent.)
(d) Determine the sales dollars required to earn net income of $180,000.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Sheridan Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 60 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2020, management estimates the following revenues and costs.
Sales
$1,980,000
Selling expenses—variable
$79,000
Direct materials
500,000
Selling expenses—fixed
56,000
Direct labor
380,000
Administrative expenses—variable
27,000
Manufacturing overhead—variable
400,000
Administrative expenses—fixed
179,500
Manufacturing overhead—fixed
210,000
(A) Compute the contribution margin ratio and the margin of safety ratio. (Round variable cost per bottle to 3 decimal places, e.g. 0.25 and final answers to 0 decimal places, e.g. 25%.)
Contribution margin ratio
enter the contribution margin ratio in percentages rounded to 0 decimal places
%
Margin of safety ratio
enter the Margin of safety ratio in percentages rounded to 0 decimal places
%
(B)…
Sheridan Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 60 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2020, management estimates the following revenues and costs.
Sales
$1,980,000
Selling expenses—variable
$79,000
Direct materials
500,000
Selling expenses—fixed
56,000
Direct labor
380,000
Administrative expenses—variable
27,000
Manufacturing overhead—variable
400,000
Administrative expenses—fixed
179,500
Manufacturing overhead—fixed
210,000
(A) Prepare a CVP income statement for 2020 based on management’s estimates.
SHERIDAN COMPANYCVP Income Statement (Estimated)For the Year Ending December 31, 2020
select an income statement item Administrative ExpensesContribution MarginCost of Goods SoldFixed ExpensesNet Income/(Loss)SalesSelling ExpensesTotal Fixed…
Polarix is a retailer of ATVs (all-terrain vehicles) and accessories. An income statement for its Consumer ATV Department for the current year follows. ATVs sell for $3,800 each. Variable selling expenses are $270 per ATV. The remaining selling expenses are fixed. Administrative expenses are 40% variable and 60% fixed. The company does not manufacture its own ATVs; it purchases them from a supplier for $1,830 each.
POLARIXIncome Statement—Consumer ATV DepartmentFor Year Ended December 31, 2017
Sales
$
646,000
Cost of goods sold
311,100
Gross margin
334,900
Operating expenses
Selling expenses
$
135,000
Administrative expenses
59,500
194,500
Net income
$
140,400
Required:
1. Prepare an income statement for this current year using the contribution margin format. (Do not round intermediate calculations. Round contribution margin per ATV value to the nearest whole number.)
Chapter 5 Solutions
MANAGERIAL ACCT.-WILEYPLUS BLKBRD PKG
Ch. 5 - (a) What is cost behavior analysis? (b) Why is...Ch. 5 - (a) Scott Winter asks your help in understanding...Ch. 5 - Contrast the effects of changes in the activity...Ch. 5 - J. P. Alexander claims that the relevant range...Ch. 5 - The relevant range is indispensable in cost...Ch. 5 - Prob. 6QCh. 5 - How should mixed costs be classified in CVP...Ch. 5 - At the high and low levels of activity during the...Ch. 5 - "Cost-volume-profit (CVP) analysis is based...Ch. 5 - Faye Dunn defines contribution margin as the...
Ch. 5 - Prob. 11QCh. 5 - Prob. 12QCh. 5 - Prob. 13QCh. 5 - Prob. 14QCh. 5 - Define the term margin of safety. If Revere...Ch. 5 - Prob. 16QCh. 5 - Prob. 17QCh. 5 - Monthly production costs in Dilts Company for two...Ch. 5 - Prob. 5.2BECh. 5 - For Wesland Company, a mixed cost is 15,000 plus...Ch. 5 - Bruno Company accumulates the following data...Ch. 5 - Markowis Corp. has collected the following data...Ch. 5 - Determine the missing amounts.Ch. 5 - Russell Inc. had sales of 2,20O,0O0 for the first...Ch. 5 - Rice Company has a unit selling price of 520,...Ch. 5 - Presto Corp. had total variable costs of 180,000....Ch. 5 - For Flynn Company, variable costs are 70% of...Ch. 5 - Prob. 5.11BECh. 5 - Prob. 5.12BECh. 5 - Amanda Company reports the following total costs...Ch. 5 - Westerville Company accumulates the following data...Ch. 5 - Prob. 5.3DICh. 5 - Snow Cap Company has a unit selling price of 250,...Ch. 5 - Presto Company makes radios that sell for 30 each....Ch. 5 - Bonita Company manufactures a single product....Ch. 5 - Shingle Enterprises is considering manufacturing a...Ch. 5 - The controller of Norton Industries has collected...Ch. 5 - Family Furniture Corporation incurred the...Ch. 5 - The controller of Hall industries has collected...Ch. 5 - PCB Corporation manufactures a single product....Ch. 5 - Marty Moser wants Moser Company to use CVP...Ch. 5 - All That Blooms provides environmentally friendly...Ch. 5 - The Palmer Acres Inn is trying to determine its...Ch. 5 - In the month of March, Style Salon services 560...Ch. 5 - Spencer Kars provides shuttle service between four...Ch. 5 - In 2016. Manhoff Company had a break-even point of...Ch. 5 - Billings Company has the following information...Ch. 5 - Naylor Company had 210,000 of net income in 2016...Ch. 5 - Yams Company reports the following operating...Ch. 5 - Glacial Company estimates that variable costs will...Ch. 5 - Felde Bucket Co., a manufacturer of rain barrels,...Ch. 5 - Vin Diesel owns the Fredonia Barber Shop. He...Ch. 5 - Jorge Company bottles and distributes B-Lite, a...Ch. 5 - Tanek Corp.'s sales slumped badly in 2017. For the...Ch. 5 - Mary Willis is the advertising manager for Bargain...Ch. 5 - Prob. 5.5APCh. 5 - Kaiser Industries carries no inventories. Its...Ch. 5 - Bill Johnson, sales manager, and Diane Buswell,...Ch. 5 - Creative Ideas Company has decided to introduce a...Ch. 5 - The condensed income statement for the Peri and...Ch. 5 - Prob. 5.3BYPCh. 5 - Prob. 5.4BYPCh. 5 - Your roommate asks for your help on the following...Ch. 5 - Prob. 5.6BYPCh. 5 - Cost-volume-profit analysis can also be used in...
Knowledge Booster
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
- Ivanhoe Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 50 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2020, management estimates the following revenues and costs. Sales $1,950,000 Selling expenses—variable $171,000 Direct materials 470,000 Selling expenses—fixed 59,000 Direct labor 340,000 Administrative expenses—variable 24,000 Manufacturing overhead—variable 360,000 Administrative expenses—fixed 120,500 Manufacturing overhead—fixed 230,000 Prepare a CVP income statement for 2020 based on management’s estimates. Compute the contribution margin ratio and the margin of safety ratio. (Round variable cost per bottle to 3 decimal places, e.g. 0.25 and final answers to 0 decimal places, e.g. 25%.) Contribution margin ratio % Margin of safety ratio % Determine the sales dollars required to…arrow_forwardIrving Corporation runs two stores, one in Medfield and one in Oakland. Operating income for each store in 2017 is as follows: Table shows the revenues, various operating costs, and operating income of Irving Corporation’s two stores, in Medfield and Oakland in the year 2017.The details of Medfield store are as follows: a. Revenues: $2,100,000 b. Operating costs • Cost of goods sold: $1,500,000 • Variable operating costs for labor and utilities: $180,000 • Lease rent renewable each year: $160,000 • Depreciation of equipment: $50,000 • Allocated corporate overhead: $90,000 • Total operating costs: $1,980,000 c. Operating income which is a loss: $120,000 The details of Oakland store are as follows: a. Revenues: $1,700,000 b. Operating costs • Cost of goods sold: $1,310,000 • Variable operating costs for labor and utilities: $170,000 • Lease rent renewable each year: $155,000 • Depreciation of equipment: $40,000 • Allocated corporate overhead: $75,000 • Total operating costs: $1,750,000…arrow_forwardDuring 2009, Accent Toys Plc., which began business in October of that year, purchased 10,000 units of a toy at a cost of ₤10 per unit in October. Th e toy sold well in October. In anticipation of heavy December sales, Accent purchased 5,000 additional units in November at a cost of ₤11 per unit. During 2009, Accent sold 12,000 units at a price of ₤15 per unit. Under the fi rst in, fi rst out (FIFO) method, what is Accent’s cost of goods sold for 2009? A . ₤120,000.arrow_forward
- During 2009, Accent Toys Plc., which began business in October of that year, purchased 10,000 units of a toy at a cost of ₤10 per unit in October. Th e toy sold well in October. In anticipation of heavy December sales, Accent purchased 5,000 additional units in November at a cost of ₤11 per unit. During 2009, Accent sold 12,000 units at a price of ₤15 per unit. Under the fi rst in, fi rst out (FIFO) method, what is Accent’s cost of goods sold for 2009? C . ₤124,000.arrow_forwardWilliams Company bottles and distributes Supe Juice, a soft drink. The beverage is sold for 50 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2020, management estimates the following revenues and costs. Sales: $1,800,000 Selling expenses—variable: $70,000 Direct materials: 430,000 Selling expenses—fixed: 65,000 Direct labor: 360,000 Administrative expenses—variable: 20,000 Manufacturing overhead—variable: 380,000 Administrative expenses—fixed: 60,000 Manufacturing overhead—fixed: 280,000 Prepare a CVP income statement for 2020 based on management’s estimates. Calculate variable cost per bottle. Compute the break-even point in units. Compute the break-even point in dollars. Compute the contribution margin ratio. Compute the margin of safety ratio. Determine the sales dollars required to earn net income of $180,000.arrow_forwardMills, Inc. manufactures a cycling bikes. There most recent data for the year are as follows: Sales………………………………....…..….…...$ 20,000 Fixed costs of goods sold………………....2,000 Fixed selling expenses ……………………...2,500 Fixed administrative expenses………..…1,500 Variable cost of goods sold ………...….....1,000 Variable selling expense…………..…....…..1,520 Variable administrative expense………....3,000 Instructions: Prepare a CVP income statement for the quarter ending June 2017. You must show your work.arrow_forward
- Bidoof Books, Inc. is a major bookseller for four nearby colleges. The income statement for the quarter of the year is presented below: Bidoof Books, Inc Income Statement For the quarter ended September 30, 2021 Sales ₱ 800,000 Less: Cost of Goods Sold 560,000 Gross Margin ₱ 240,000 Less: Operating Expenses Less: Selling Expenses ₱ 100,000 Less: Administrative Expenses 110,000 210,000 Net Operating Income ₱ 30,000 On average, a book sells for ₱400. Cost of goods sold is entirely variable. Unit variable selling expenses are ₱30 per book; the remaining selling expenses are fixed. The variable administrative expenses are 5% of sales; the remainder of the administrative expenses are fixed. The TOTAL FIXED COSTS for September 2021 amount to ₱________________.arrow_forwardJacob’s Landing Inc. has sales of 2,000 for the first quarter of 2019. The company incurred the following costs and expenses from making sales. Variable Fixed Cost of goods sold $70 60 Selling expense $50 80 Administrative expenses $95 66 Instructions: Prepare a CVP income statement for the quarter ended March 2010.arrow_forwardLast year, Pastis Productions reported $100,000 in sales and $40,000 in cost of goods sold. Thecompany estimates it would have doubled its sales and cost of goods sold had it allowed customersto buy on credit, but it also would have incurred $50,000 in additional expenses relating to wages,bad debts, and interest. Should Pastis Productions extend credit?arrow_forward
- Carla Vista Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 50 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2020, management estimates the following revenues and costs. Sales $2,000,000 Selling expenses—variable $109,000 Direct materials 550,000 Selling expenses—fixed 58,000 Direct labor 400,000 Administrative expenses—variable 21,000 Manufacturing overhead—variable 420,000 Administrative expenses—fixed 52,000 Manufacturing overhead—fixed 190,000 Prepare a CVP income statement for 2020 based on management’s estimates. Calculate variable cost per bottle.arrow_forwardSouth Coast Appliance Store is a small company that has hired you to perform some management advisory services. The following information pertains to 2017 operations. Sales (5,500 microwave ovens) $5,500,000 Cost of goods sold 962,500 Store manager's salary per year 150,000 Operating costs per year 220,000 Advertising and promotion per year 18,960 Commissions (3.2% of sales) 176,000 What was the variable cost per unit sold for 2017?arrow_forwardZ co. is a manufacturer of corn and vegetable cooking oils. It had the following data in a month, VAT not included: Sales P900,000 Purchases from farmers: Of corns P200,000 Of vegetables P220,000 Purchases from VAT suppliers: Of paper labels P5,000 Others P500 Purchases of plastic containers from VAT suppliers P40,000 Purchases of machine parts from non-vat supplier P80,000 How much was the value-added tax payable for the month?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Excel Applications for Accounting PrinciplesAccountingISBN:9781111581565Author:Gaylord N. SmithPublisher:Cengage Learning
Principles of Cost AccountingAccountingISBN:9781305087408Author:Edward J. Vanderbeck, Maria R. MitchellPublisher:Cengage Learning
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Cengage Learning
Principles of Cost Accounting
Accounting
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
IAS 29 Financial Reporting in Hyperinflationary Economies: Summary 2021; Author: Silvia of CPDbox;https://www.youtube.com/watch?v=55luVuTYLY8;License: Standard Youtube License