Question:
Calculating cost-volume profit elements The budgets of four companies yield the following information:
|
|
Company
|
|
|
Up
|
Down
|
Left
|
Right
|
|
Sales revenue
|
$ 900,000
|
$ (4)
|
$ 710,000
|
$ (10)
|
|
Variable costs
|
(1)
|
208,000
|
319,500
|
240,000
|
|
Fixed costs
|
(2)
|
135,000
|
235,000
|
(11)
|
|
Operating income (loss)
|
$ 10,000
|
$ (5)
|
$ (7)
|
$ 49,000
|
|
Units sold
|
100,000
|
16,000
|
(8)
|
(12)
|
|
Contribution margin per unit
|
$ 3.60
|
$ (6)
|
$ 78.10
|
$ 10.00
|
|
Contribution margin ratio
|
(3)
|
0.60
|
(9)
|
0.20
|
Requirements
1. Fill in the blanks for each missing value. (Round the contribution margin to the nearest cent.)
2. Which company has the lowest breakeven point in sales dollars?
3. What causes the low breakeven point?