An asterisk (*) will appear to the right of an incorrect entry.
1.
Sales
Cost of goods sold:
Direct materials
Direct labor
Factory overhead
Cost of goods sold
Gross profit
Expenses:
Selling expenses
Sales salaries and commissions
Advertising
Travel
Miscellaneous selling expense
Total selling expenses
Administrative expenses:
Office and officers’ salaries
Supplies
Miscellaneous administrative expense
Total administrative expenses
Total expenses
Income from operations
2.
Contribution margin ratio:
Sales
Variable costs
Contribution margin
Sales
Contribution margin ratio
3.
Break-even sales:
Fixed costs
Unit contribution margin
Break-even sales (units)
Sale price
Break-even sales (dollars)
4. For each unit level of sales, enter the total sales dollars and total costs. The chart at right will be plotted as you enter the amounts.
After all points are plotted, grab and move the labels provided at the left to identify each area.
Units Sales $ Costs $
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
5.
Margin of safety:
0%
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Instructions
Problem 19(4)-6B
Units Unit Variable Cost
Sale Price – Unit Variable Cost
BELMAIN CO.
Estimated Income Statement
For the Year Ended December 31, 2014
$-
$0
$0
$1
$1
$1
$1
0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000
Sales and Costs
Units
Cost-Volume-Profit Chart
Sales $
Costs $
Break-Even
Point
Operating Profit Area
Sale Price Units
Expected sales
Break-even point
Margin of safety (in dollars)
Expected sales
Margin of safety (as a percentage of sales)
6.
Operating leverage:
Unit CM $ Units
Contribution margin
Income from operations
Operating leverage
An asterisk (*) will appear to the right of an incorrect entry.
1.
Sales 2,880,000$
2.
Contribution margin ratio:
Sales 2,880,000$
4. For each unit level of sales, enter the total sales dollars and total costs. The chart at right will be plotted as you enter the amounts.
After all points are plotted, grab and move the labels provided at the left to identify each area.
Units Sales $ Costs $
0 –$ 1,152,000$
2,000 480,000 1,344,000
ON
Key Code:
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Score:
Instructions
Answers are entered in the cells with gray backgrounds.
Problem 19(4)-6B
Name:
Solution
Section:
BELMAIN CO.
Estimated Income Statement
For the Year Ended December 31, 2014
5.
Margin of safety: