Managerial Accounting: E20-5 Senora Company manufactures a single product

Managerial Accounting
E20-5. Mixed Costs: High-Low Method
Senora Company manufactures a single product that sells for $110 per unit. The company projects sales of 500 units per month. Projected costs are as follows:
Type of Cost Manufacturing Nonmanufacturing
Variable 10,000 5,000
Nonvariable 12,500 7,500

1. Prepare a contribution margin income statement for the month.
2. What is the contribution margin ratio?
3. What volume, in terms of units, must the company sell to break even?
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