CVP Charting
Not what you're looking for?
Franscioso Company sells several products. Information of revenue and cost per unit when 11,000 units are sold is as follows:
Selling price per unit $28.50
Direct material $5.25
Direct manufacturing labor $1.15
Manufacturing overhead $0.25
Variable selling costs $1.85
Annual fixed costs per unit $10.00
Required:
1. What is the Contribution Margin if 11,000 units are sold?
2. What is operating income if 15,000 units are sold?
3. What is the breakeven point in units?
4. What is the margin of safety if 12,000 units are sold?
5. Graph the following assuming 0 to 15,000 units are sold and find the following:
a. Total Revenue
b. Total Variable Costs
c. Total Fixed Costs
d. Total Costs
e. Breakeven point on the graph
Purchase this Solution
Solution Summary
CVP analysis is an important tool in financial decision making. Solution to given problem depicts the steps to calculate the contribution margin, operating income, breakeven point and margin of safety. CVP graph is also created in MS Excel format.
Solution Preview
Please refer attached file for better formatting and graph.
1. What is the Contribution Margin if 11,000 units are sold?
Total Variable Cost per unit=V=5.25+1.15+0.25+1.85= $8.50
Fixed Cost=F=10*11000=$110,000.00
Selling Price per unit=P=$28.50
Contribution margin per unit=CM=P-V=28.50-8.50=$20.00
Total Contribution Margin if 11000 units are sold=CM*11000=$220,000.00
2. What is operating income if 15,000 units are sold?
Total Variable Cost=TVC=V*Q=8.50*15000=127,500.00
Total Fixed ...
Education
- BEng (Hons) , Birla Institute of Technology and Science, India
- MSc (Hons) , Birla Institute of Technology and Science, India
Recent Feedback
- "Thank you"
- "Really great step by step solution"
- "I had tried another service before Brain Mass and they pale in comparison. This was perfect."
- "Thanks Again! This is totally a great service!"
- "Thank you so much for your help!"
Purchase this Solution
Free BrainMass Quizzes
Lean your Process
This quiz will help you understand the basic concepts of Lean.
Marketing Management Philosophies Quiz
A test on how well a student understands the basic assumptions of marketers on buyers that will form a basis of their marketing strategies.
Operations Management
This quiz tests a student's knowledge about Operations Management
Cost Concepts: Analyzing Costs in Managerial Accounting
This quiz gives students the opportunity to assess their knowledge of cost concepts used in managerial accounting such as opportunity costs, marginal costs, relevant costs and the benefits and relationships that derive from them.
Change and Resistance within Organizations
This quiz intended to help students understand change and resistance in organizations