## Contribution Margin

Contribution Margin in \$15 Only

1. Contribution margin for Gliders under each of the following assumptions: actual sales volume at budgeted selling prices, budgeted resource usage, and budgeted costs.

2. Contribution margin for Chairs with Footstools under each of the following assumptions: actual sales volume at budgeted selling prices, budgeted resource usage, and budgeted costs.

Team Assignment 2: Project-Analysis, Sales Promotions

Price of Answer: Just US\$15 only

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## Objective Type Questions

a) A company sells a product which has a unit sales price of \$5, unit variable cost of \$3 and total fixed costs of \$120,000. The number of units the company must sell to break even is

1. 60,000 units.
2. 24,000 units.
3. 240,000 units.
4. 40,000 units.

b) A company has total fixed costs of \$120,000 and a contribution margin ratio of 20%. The total sales necessary to break even are

1. \$480,000.
2. \$600,000.
3. \$150,000.
4. \$144,000.

c) At the break-even point of 2,500 units, variable costs are \$55,000, and fixed costs are \$32,000. How much is the selling price per unit?

1. \$34.80
2. \$9.20
3. \$12.80
4. \$22.00

## Write up on Cost, Volume and Profit Analysis

Write up on Cost, Volume and Profit Analysis in \$3 Only

Write a 350 to 700-word paper, using APA guidelines, that addresses the following:
o Explain the components of cost-volume-profit analysis.
o What does each of the components mean?
o Based on the formulas you have reviewed, what happens to contribution margin per unit when unit selling prices increase? Illustrate your explanation with an example from a fictitious company of how an increase in unit selling prices might affect contribution margin.
o When fixed costs decrease, what does this do for sales? Illustrate your explanation with an example from a fictitious company.
o Define contribution ratios.
o What happens to contribution ratios as one of the components changes?