Sandy Bank, Inc., makes one model of wooden canoe. Partial information for it fo

Question

Sandy Bank, Inc., makes one model of wooden canoe. Partial information for it follows: Required 1. Complete the following table. (Round your "Cost per Unit" answers to 2 decimal places.) Number of Canoes Produced and Sold 460 600 730 Total costs $ 68,540 148,120 $ 216,660 Variable Costs Fixed Costs Total Costs Cost per Unit Variable Cost per Unit Fixed Cost per Unit Total Cost per Unit 2. Suppose Sandy Bank sells its canoes for $530 each. Calculate the contribution margin per canoe and the contribution margin ratio. (Round your intermediate calculations and final answers to 2 decimal places. Round your "percentage" answer to 2 decimal places. (i.e. .1234 should be entered as 12.34%.)) Unit Contribution Margir Contribution Margin Ratio per Cance

Explanation / Answer

1 Number of canoes produced and sold 460 600 730 total costs: varible costs 68540 89400 108770 Fixed costs 148120 148120 148120 Total costs 216660 237520 256890 Cost per unit: Variable cost per unit 149 149 149 Fixed cost per unit 322 246.87 202.90 Total cost per unit 471 395.87 351.90 2 sale price 530 less:variable cost per unit -149 contribution margin per canoe 381 contribution margin ratio(contribution/sales) 0.72 3 sales(810*530) 429300 less:variable cost(810*149) -120690 contribution margin 308610 less:fixed costs -148120 income from operations 160490 4 break even point in units = fixed cost/contribution margin per unit = 148120/381 =389 canoes break even sales revenue = break even units*sale price = 389*530 =$206,170 5 target sales units = (fixed cost+profit)/contribution margin per unit =(148120+67000)/381 =565 canoes

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