I need this by SAT the 28th by 6:00pm ET
Problem 1:
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The Peace Company has the following functional (traditional) income statement for the prior month.
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Sales
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($50 * 100,000 units)
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$5,000,000
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Cost of goods sold
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Direct materials
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$1,200,000
|
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Direct labor
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$950,000
|
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Variable factory overhead
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$600,000
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Fixed factory overhead
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$850,000
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$3,600,000
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Gross profit
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$1,400,000
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Selling and administrative expense
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Variable
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$250,000
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Fixed
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$120,000
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$370,000
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Operating income
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$1,030,000
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There were no beginning and ending inventories.
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Required:
- Calculate the contribution margin per unit.
- Calculate the contribution margin ratio.
- What is the break-even point in units?
- What is the amount of sales in dollars needed to obtain a before-tax profit of $40,000?
Problem 2:
Suzy Manufacturing has estimated monthly sales of 18,000 units for $48 per unit. Variable costs include manufacturing costs of $27 and distribution costs of $9 per unit. Fixed costs are $60,000 per month.
Required
Determine each of the following values.
- Unit contribution margin
- Monthly break-even unit sales volume
- Before-tax monthly profit
- Monthly margin of safety in units
e. Create a contribution margin-based income statement.
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