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Posted by: Homeworkhelp
Price Quoted by Student: $8
Posted On: 2011-05-20 03:03:48
 
Question

P6-2A Utech Company bottles and distributes Livit, a diet soft drink. ANSWER KEY

 

P6-2A Utech Company bottles and distributes Livit, 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 2008, management estimates the following revenues and costs.

 

Net sales

$1,800,000

Selling expenses—variable

$70,000

Direct materials

430,000

Selling expenses—fixed

65,000

Direct labor

352,000

Administrative expenses—variable

20,000

Manufacturing overhead—variable

316,000

Administrative expenses—fixed

60,000

Manufacturing overhead—fixed

283,000

 

 

Instructions

a) Prepare a CVP income statement for 2008 based on management's estimates

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 full percents.)

d) Determine the sales dollars required to earn net income of $238,000


Solutions
Please see the attachment ANSWER KEY P6-2A Utech
Price $8
Attachment 1: P6-2A Utech Company.doc
Solution Posted By: Homeworkhelp    Posted on: 20-05-2011