Due to erratic sales of its sole product—a high-capacity battery for laptop comp
ID: 2376005 • Letter: D
Question
Due to erratic sales of its sole product—a high-capacity battery for laptop computers—PEM, Inc., has been experiencing difficulty for some time. The company's contribution format income statement for the most recent month is given below:
264,600
$(13,500)
Assume that the company expects to sell 20,500 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) (Input all amounts as positive values. Round your per unit cost to 1 decimal place and all other answers to the nearest dollar, percentage values. Omit the "$" and "%" signs in your response.)
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Due to erratic sales of its sole product—a high-capacity battery for laptop computers—PEM, Inc., has been experiencing difficulty for some time. The company's contribution format income statement for the most recent month is given below:
Explanation / Answer
Income statement: Not Automated Automated Total Per Unit % Total Per Unit % Sales (20,500 units) $ 615,000 $ 30 100 $ $ Variable expenses 264,000 43 Contribution margin 351,000 $ 17 57 $ Fixed expenses 126,900 21 Net operating income $ 224,100 Not Automated Automated Total Per Unit % Total Per Unit % Sales (20,500 units) $ 615,000 $ 30 100 $ $ Variable expenses 264,000 43 Contribution margin 351,000 $ 17 57 $ Fixed expenses 126,900 21 Net operating income $ 224,100 Not Automated Automated Total Per Unit % Total Per Unit % Sales (20,500 units) $ 615,000 $ 30 100 $ $ Variable expenses 264,000 43 Contribution margin 351,000 $ 17 57 $ Fixed expenses 126,900 21 Net operating income $ 224,100Related Questions
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