ment Bridgeport Co, a manufacturer of rain barrels, had the following data for 2
ID: 2402417 • Letter: M
Question
ment Bridgeport Co, a manufacturer of rain barrels, had the following data for 2016 Sales Sales price Variable costs Fixed costs $130,284 4,200 units $60 per unit $27 per unit What is the contribution margin ratio? (Round answer to O decimal places, e.g. S,275.) Contribution margin ratio What is the break-even point in dollars? (Round intermediate calculation and final ansiwers to 0 decimal places, e.g. 3,275.) LINK TO TEXT LINK TO TEXTLINE TO TEXT What is the margin of safety in dollars and as a ratio? (Round ratio to 2 decimal places, o.g. 12.25.) Margin of safety 15120 Margin of safety ratio e here to searchExplanation / Answer
contribution margin=Sales-Variable costs
=(60-27)=$33 per unit
Total Current total contribution margin=(33*4200)=$138600
Required contribution margin=(138600*1.3)=$180180
Hence dollar sales required=Required contribution margin/contribution margin ratio
=(180180/0.55)=$327600
Current total sales=(4200*60)=$252000
Hence increase in sales required=(327600-252000)
=$75600.
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