1.) Super-Tee Co. plans to sell 12,000 T-shirts at $16 each in the coming year....
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Accounting
1.) Super-Tee Co. plans to sell 12,000 T-shirts at $16 each in the coming year. Product costs include:
Direct materials per shirt $5.75
Direct labor per shirt 1.25
Variable overhead per shirt .60
Fixed overhead in total $43,000
What is the company's contribution margin?
a.)
$9.00
b.) $4.82
c.) $10.25
d.) $8.40
2.) Super-Tee has a contribution margin of 25%. How many T-shirts (rounded to the nearest shirt) must be sold in order for the company to break even?
a.) 3,583
b.) 10,750 T-shirts
c.) 5,375 T-shirts
d.) 172,000 T-shirts
3.) If Super-Tee has a contribution margin per T-shirt of $5.00. How many shirts must be sold in order to earn of profit of $20,000?
a.) 4,000
b.) 8,600
c.) 12,600
d.) 5,727
4.) If the contribution margin ratio for ABC Co. is 20%, the variable cost ratio was 80%, sales were $2,000,000 and fixed costs were $100,000, what was income from operations?
a.) $300,000
b.) $1,500,000
c.) $400,000
d.) $1,600,000
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