EXERCISE 5-18 Missing Data; Basic CVP Concepts [L01, LO9] Fill in the missing am

Question

EXERCISE 5-18 Missing Data; Basic CVP Concepts [L01, LO9] Fill in the missing amounts in each of the eight case situations below. Each case is independent of the others. (Hint: One way to find the missing amounts would be to prepare a contribution format income statement for each case, enter the known data, and then compute the missing items.) a. Assume that only one product is being sold in each of the four following case situations: Net Operating Contribution Margin Units Sold Fixed Income Expenses per Unit Expenses(Loss) Variable Case Sales $90,000 $170,000 $40,000 $35,000 $82,000 $(12,000) ? $350,000 $15 S6 2 3..20,000 4 $280,000 5,000 $160,000 b. Assume that more than one product is being sold in each of the four following case situations: Net Average Contribution Operating Fixed Income Sales Expenses (Percent) Expenses(Loss) $65,000 Variable Margin Case 40% $60,000 $470,000 80% $90,000 3 4.... $300,000 $90,000 ?$(15,000)

Explanation / Answer

a) Case Units sold Sales Variable expenses Contribution Margin per Unit Fixed Expenses Net Operating Income (Loss) 1 9000 270000 162000 48.0 90000 342000 2 14000 350000 140000 15.0 170000 40000 3 20000 400000 280000 6.0 85000 35000 4 5000 160000 66000 18.8 82000 -12000 WORKINGS:- CONTRIBUTION MARGIN INCOME STATEMENT: Case Units sold Sales Variable expenses Contribution Margin Fixed Expenses Net Operating Income (Loss) 1 9000 270000 162000 432000 90000 342000 2 14000 350000 140000 210000 170000 40000 3 20000 400000 280000 120000 85000 35000 4 5000 160000 66000 94000 82000 -12000 b) Case Sales Variable expenses Average Contribution Margin (Percent) Fixed Expenses Net Operating Income (Loss) 1 450000 270000 40.00% 115000 65000 2 200000 130000 35.00% 60000 90000 3 700000 140000 80.00% 470000 90000 4 300000 90000 70.00% 225000 -15000 WORKINGS:- CONTRIBUTION MARGIN INCOME STATEMENT: Case Sales Variable expenses Contribution Margin Fixed Expenses Net Operating Income (Loss) 1 450000 270000 180000 115000 65000 2 200000 130000 70000 60000 10000 3 700000 140000 560000 470000 90000 4 300000 90000 210000 225000 -15000

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