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Variable Costs, Contribution Margin, Contribution Margin Ratio

Super-Tees Company plans to sell 10,000 T-shirts at $21 each in the coming year. Product costs include:

Direct materials per T-shirt	$7.35
Direct labor per T-shirt	$1.47
Variable overhead per T-shirt	$0.63
Total fixed factory overhead	$36,000

Variable selling expense is the redemption of a coupon, which averages $1.05 per T-shirt; fixed selling and administrative expenses total $13,000.

Required:

1. Calculate the following values: Round dollar amounts to the nearest cent and round ratio values to three decimal places (express the ratio as a decimal rather than a percentage). a. Variable product cost per unit b. Total variable cost per unit C. Contribution margin per unit d. Contribution margin ratio e. Total fixed expense for the year $ 2. Prepare a contribution-margin-based income statement for Super-Tees Company for the coming year. If required, round your per unit answers to the nearest cent. Super-Tees Company Contribution-Margin-Based Operating Income Statement For the Coming Year Total Per Unit $ 3. What if the per unit selling expense increased from $1.05 to $2.25? Calculate new values for the following: Round dollar amounts to the nearest cent and round ratio values to four decimal places (express the ratio as a decimal rather than a percentage): a. Variable product cost per unit b. Total variable cost per unit c. Contribution margin per unit d. Contribution margin ratio IIII) e. Total fixed expense for the year

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