Instructions Prepare a memo to Vic Taley concerning the assumptions that underlie CVP analysis. E22-5...
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Instructions Prepare a memo to Vic Taley concerning the assumptions that underlie CVP analysis. E22-5 In the month of June, Bonita Beauty Salon gave 2,700 haircuts, shampoos, and perma- Compute contribution margin, nents at an average price of $30. During the month, fixed costs were $18,000 and variable costs break-even point, and margin were 70% of sales. of safety. (SO 5, 6, 8) Instructions (a) Determine the contribution margin in dollars, per unit, and as a ratio. (b) Using the contribution margin technique, compute the break-even point in dollars and in units. (c) Compute the margin of safety in dollars and as a ratio. SERVICE 11
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