Exercise 19-2 In the month of June, Jose Hebert\'s Beauty Salon gave 4,100 hairc
ID: 2547513 • Letter: E
Question
Exercise 19-2 In the month of June, Jose Hebert's Beauty Salon gave 4,100 haircuts, shampoos, and permanents at an average price of $40. During the month, fixed costs were $17,000 and variable costs were 75% of sales. Determine the contribution margin in dollars, per unit and as a ratio. (Round contribution margin per unit and contribution margin ratio to 2 decimal places, e.g. 5.25& 10.50.) Contribution margin Contribution margin per unit Contribution margin ratio Using the contribution margin technique, compute the break-even point in dollars and in units. (Round answers to 0 decimal places, e.g. 1,225.) Break-even point Break-even point Compute the margin of safety in dollars and as a ratio. (Round answers to O decimal places, e.g. 1,225.) Parity Margin of safety ratio sExplanation / Answer
Answer
A=4100 x 40
Sales
$ 1,64,000.00
B=A x 75%
Variable cost
$ 1,23,000.00
C= A - B
Contribution margin
$ 41,000.00
D
Units (haircuts)
4100
E=C/D
Contribution margin per unit
$ 10.00
F=C/A
Contribution margin ratio
25%
A
Fixed Cost
$ 17,000.00
B
Contribution margin ratio
$ 0.25
C=A/B
Break Even in Dollars
$ 68,000.00
D
Contribution margin per unit
$ 10.00
E=A/D
Break Even in Units
1700
A
Total Sales
$ 1,64,000.00
B
Break Even point in Dollars
$ 68,000.00
C=A-B
Margin of Safety Sales $
$ 96,000.00
D=C/A
Margin of Safety ratio
59%
A=4100 x 40
Sales
$ 1,64,000.00
B=A x 75%
Variable cost
$ 1,23,000.00
C= A - B
Contribution margin
$ 41,000.00
D
Units (haircuts)
4100
E=C/D
Contribution margin per unit
$ 10.00
F=C/A
Contribution margin ratio
25%
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.