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Problem 5-2A (Part Level Submission) Jorge Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 50 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2017, management estimates the following revenues and costs. Sales $1,870,000 Selling expensesvariable $50,000 Direct materials 400,000 Selling expensesfixed 55,000 Direct labor 360,000 Administrative expensesvariable 49,000 Manufacturing overheadvariable 450,000 Administrative expensesfixed 52,000 Manufacturing overheadfixed 304,000

(a) Prepare a CVP income statement for 2017 based on managements estimates. JORGE COMPANY CVP Income Statement (Estimated) For the Year Ending December 31, 2017For the Month Ended December 31, 2017December 31, 2017 Administrative ExpensesContribution MarginCost of Goods SoldFixed ExpensesNet Income/(Loss)SalesSelling ExpensesTotal Fixed ExpensesTotal Variable ExpensesVariable ExpensesGross Profit $ Administrative ExpensesContribution MarginCost of Goods SoldFixed ExpensesNet Income/(Loss)SalesSelling ExpensesTotal Fixed ExpensesTotal Variable ExpensesVariable ExpensesGross Profit Administrative Expenses Contribution Margin Cost of Goods Sold Fixed Expenses Net Income/(Loss) Sales Selling Expenses Total Fixed Expenses Total Variable Expenses Variable Expenses Gross Profit $ Administrative Expenses Contribution Margin Cost of Goods Sold Fixed Expenses Net Income/(Loss) Sales Selling Expenses Total Fixed Expenses Total Variable Expenses Variable Expenses Gross Profit Administrative Expenses Contribution Margin Cost of Goods Sold Fixed Expenses Net Income/(Loss) Sales Selling Expenses Total Fixed Expenses Total Variable Expenses Variable Expenses Gross Profit Administrative Expenses Contribution Margin Cost of Goods Sold Fixed Expenses Net Income/(Loss) Sales Selling Expenses Total Fixed Expenses Total Variable Expenses Variable Expenses Gross Profit Administrative ExpensesContribution MarginCost of Goods SoldFixed ExpensesNet Income/(Loss)SalesSelling ExpensesTotal Fixed ExpensesTotal Variable ExpensesVariable ExpensesGross Profit 1) Calculate variable cost per bottle. (Round variable cost per bottle to 2 decimal places, e.g. 0.25. 2) Compute the break-even point in (1) units and (2) dollars.(Round answers to 0 decimal places, e.g. 1,225.) 3) Compute the contribution margin ratio and the margin of safety ratio. (Round variable cost per bottle to 2 decimal places, e.g. 0.25 and final answers to 0 decimal places, e.g. 25%.) 4) Determine the sales dollars required to earn net income of $240,910. (Round answers to 0 decimal places, e.g. 1,225.)

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