Using Cost-Volume-Profit Formulas Fantasy Corporation Manufactures a Single Product. the Selling Price Is
Using cost-volume-profit formulas
Fantasy Corporation manufactures a single product. The selling price is $125 per unit, and variable costs amount to $81 per unit. The fixed costs are $28,500 per month.
(a) What is the contribution margin per unit? $________________ per unit
(b) What is the contribution margin ratio? ________________% (Rounded to 1 decimal place)
(c) What is the monthly sales volume (in dollars) at the break-even point? $_________________
(d) How many units must be sold each month to earn a monthly operating income of $50,000? _______________ units
(e) What is the monthly margin of safety (in dollars) if 1,500 units are sold each month? $________________
(f) What will be the monthly operating income if 1,500 units are sold each month? $________________
Correct Answer:
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(b) 35.2%
(c)...
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