PA5-4 Predicting Cost Behavior, Calculating Contribution Margin and Contribution

Question

PA5-4 Predicting Cost Behavior, Calculating Contribution Margin and Contribution Margin Ratio, Calculating Profit [LO 5-1, 5-5 Presidio, Inc. produces one model of mountain bike. Partial information for the company follows Required: 1. Complete Presidio's cost data table. (Round your Cost per Unit answers to 2 decimal places.) Bikes Produced and Sold 450 Units 910 Units 1248 Units Variable costs S 144,000 Foxed costs per year Total costs S 144,000 S Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit 0.00 S 533.00 $ 0.00 2. Calculate Presidio's contribution margin ratio and its total contribution margin at each sales level indicated in the cost data table assuming the company sells each bike for $640. (Round your Margin Ratio percentage answers to 2 decimal places (i.e. .1234 should be entered as 12.34%.)) 450 Units 910 Units 1248 Units Total Contibution Margin Contribution Margin Ratio 3. Calculate net operating income (loss) at each of the sales levels assuming a sales price of $640. (Round your answers to the nearest whole dollar amount.) 450 Units 910 Units 1248 Units Net Operating Income (Loss)

Explanation / Answer

1) Complete table :

2) Calculate following :

3) Net operating income :

450 Units 910 Units 1248 Units Total cost Variable cost 144000 291200 399360 Fixed cost 193830 193830 193830 Total cost 337830 485030 593190 Cost per unit Variable cost per unit 320 320 320 Fixed cost per unit 430.73 213 155.31 Total cost per unit 750.73 533 475.31

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