Morning Dove Company manufactures one model of birdbath, which is very popular.

Question

Morning Dove Company manufactures one model of birdbath, which is very popular. Morning Dove sells all units it produces each month The relevant range is 0-1,900 units, and monthly production costs for the production of 1,400 units follow. Morning Dove's utilities and maintenance costs are mixed with the fixed components shown in parentheses. Production Costs Direct materials Direct labor Utilities ($140 fixed) Supervisor's salary Maintenance ($300 fixed) Depreciation Total Cost $2,700 7,100 620 3,400 480 850 Suppose it sells each birdbath for $28 Required 1. Calculate the unit contribution margin and contribution margin ratio for each birdbath sold. (Round Variable cost per unit to 2 decimal places. Enter all amounts as positive values.) - Uni Contribution Margin per Birdbath Contribution Margin Ratio 2. Complete the contribution margin income statement assuming that Morning Dove produces and sells 1,600 units. (Round your intermediate calculation to two decimal place.) MORNING DOVE COMPANY Contribution Margin Income Statement Expected for 1,600 Units Sales Revenue ariable Costs Contribution Margin Fixed Costs Net Operating Income

Explanation / Answer

Answer to Part 1

Answer to 2

Particulars Amt Per Unit Sales (1400 x 28) (A)    39,200.00         28.00 Less: Direct Material      2,700.00           1.93 Less: Direct Labor      7,100.00           5.07 Less: Utilities (620-140)          480.00           0.34 Less: Maintenance (480-300)          180.00           0.13 Contribution Margin (B)    28,740.00         20.53 Contribution Ratio (B/A) 73.32%

Related Questions

Navigate

• Browse (All)
• Browse M
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.