Exercise 3-13 (Part Level Submission) Wildhorse Monograms sells stadium blankets

Question

Exercise 3-13 (Part Level Submission) Wildhorse Monograms sells stadium blankets that have been monogrammed with high school and university emblems. The blankets retail for $45 throughout the country to loyal alumni of over 1,800 schools. Wildhorse's variable costs are 41% of sales; fixed costs are $118,000 per month (al) Your answer is correct. Calculate contribution margin ratio. (Round ratio to 2 percentage places, eg, 0.38 = 38%.) 59 Contribution margin ratio LINK TO TEXT LINK TO VIDEO LINK TO VIDEO

Explanation / Answer

Current Increased variable cost 20.7 (0.46*45) New fixed cost 131600 (118000+13600) New Sale Price 49.5 New contribution margin ratio 0.581818 (49.5-20.7)/49.5) Breakeven sales Fixed cost/contribution margin ratio 226188 (131600/0.58) 226897

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