Question 14 Swimkids is a swimsuit manufacturer. They sell swim suits at a selli

Question

Question 14

Swimkids is a swimsuit manufacturer. They sell swim suits at a selling price is $30 per unit. Swimkids variable costs are $18 per unit. Fixed costs are $80,200. Swimkids expects sales of $266,700 next year. What is Swimkids's margin of safety?

Question 15

Lambardi Company sells 3 types of bags.  Bag A sells for $17 and has variable cost of $9.00 per unit.  Bag B sells for $15 and has variable cost of $12.00 per unit. Bag C sells for $8 and has variable costs of $6.00 per unit. Lambardi sells in a mix of 2 units of A, 3 units of B and 5 units of C. What is the weighted average contribution margin per unit for Lambardi?

Explanation / Answer

Q14. Margin of safety = 24.82% (or 6683 units)

Q15. Weighted average contribution margin per unit = 27.91%

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