American Public University Operations And Supply Chain Management Assignment Help - Company sells
Question - Suppose that Adams Company sells a product for $20. Unit costs are as follows: Direct materials $3.90 Direct labor 1.40 Variable factory overhead 2.10 Variable selling and administrative expense 1.60 Total fixed factory overhead is $52,000 per year, and total fixed selling and administrative expense is $38,530. Required: 1. Calculate the variable cost per unit and the contribution margin per unit. 2. Calculate the contribution margin ratio and the variable cost ratio. 3. Calculate the break-even units. 4. Prepare a contribution margin income statement at the break-even number of units.
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