Sandy Bank, Inc., makes one model of wooden canoe. Partialinformation is given below.
Required:
1. Complete the following table.
2. Suppose Sandy Bank sells its canoes for $580each. Calculate the contribution margin per canoe and thecontribution margin ratio.
3. This year Sandy Bank expects to sell 810canoes. Prepare a contribution margin income statement for thecompany.
4. Calculate Sandy Bank’s break-even point inunits and in sales dollars.
5. Suppose Sandy Bank wants to earn $85,000profit this year. Calculate the number of canoes that must be soldto achieve this target.
1. Complete the following table. (Round your "Cost per Unit"answers to 2 decimal places.)
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| | Number of Canoes Produced and Sold | 480 | 550 | 780 | | Total costs | | | | | Variable Costs | $76,800 | | | | Fixed Costs | 159,360 | | | | Total Costs | $236,160 | $0 | $0 | | Cost per Unit | | | | | Variable Cost per Unit | | | | | Fixed Cost per Unit | | | | | Total Cost per Unit | $0.00 | $0.00 | $0.00 |
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2. Suppose Sandy Bank sells its canoes for $580 each. Calculatethe contribution margin per canoe and the contribution marginratio. (Round your intermediate calculations and final answers to 2decimal places. Round your "percentage" answer to 2 decimal places.(i.e. .1234 should be entered as 12.34%.))
| | | | | Unit Contribution Margin | | per Canoe | | Contribution Margin Ratio | | % |
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3. This year Sandy Bank expects to sell 810 canoes. Prepare acontribution margin income statement for the company. (Round yourintermediate calculations to 2 decimal places.)
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| | SANDY BANK, Inc. | | Contribution Margin IncomeStatement | | For the Current Year | | | | | | | | | | Contribution Margin | | | | | | | | | Income from Operations |
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4. Calculate Sandy Bank’s break-even point in units and in salesdollars. (Round final answers to the nearest whole number.)
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| | | | | Break-Even Units | | Canoes | | Break-Even SalesRevenue |
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5. Suppose Sandy Bank wants to earn $85,000 profit this year.Calculate the number of canoes that must be sold to achieve thistarget. (Round Unit Contribution Margin to 2 decimal places. Roundyour answer to the next whole number.)
