Contribution Margi
CM Ratio Formula
CM per Unit / Sales per Unit
CM ($) / Sales ($)
What are the three lines, and what do they mean
Fixed Costs: shows the line in which fixed costs remain constant
Total Costs: Variable costs + Fixed
Sales: Revenue from every sale of a unit
Gross Margin
Sales - Cost of Goods Sold
Administration Costs
(Fixed/Variable/Mixed) (Period/Product)
Mixed Period Costs
Sales $10,000
Variable Costs $6,000
What is the CM Ratio?
40%
The Intersection between Total Costs and Sales
Break Even
CPA
Certified Public Accountant
Advertising Costs
(Fixed/Variable/Mixed) (Period/Product)
Fixed Period Cost
What is Sales per unit?
CM $100 Per unit
CM Ratio 40%
$250 per unit
Total Costs Y Intercept
Total Fixed Costs
Cost of Goods Manufactured
Starting WIP: 1,000
Applied OH: 500
Actual OH: 540
Raw Materials used in Production (Direct): 500
Direct Labor: 500
Ending WIP: $500
$2,000
Manufacturing Overhead
(Fixed/Variable/Mixed) (Period/Product)
Mixed Product Cost
Break Even Cost (in $ Sales)
Fixed Costs: $50,000
Sales $150,000
Variable Costs $120,000
$250,000
What can the CVP Graph help you visualize?
Break-Even Point
What Income Statement format is used GAAP
Gross Margin Income Statement
Contribution Margin Income Statements Split Variable and Fixed costs into two sections (True/False)
False
CM Ratio 55%
CM $550,000
Sales Price $25 per unit
How many units sold
40000 units
A higher variable cost per unit
Fixed MO is what under Variable Costing
Costs for shipping products
(Fixed/Variable/Mixed) (Product/Period)
Variable Period