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Problem 11-2 Bramble Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold...

Problem 11-2

Bramble 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 $1,840,000 Selling expenses—variable $60,000
Direct materials 390,000 Selling expenses—fixed 55,000
Direct labor 320,000 Administrative expenses—variable 34,000
Manufacturing overhead—variable 300,000 Administrative expenses—fixed 46,000
Manufacturing overhead—fixed 417,000
Prepare a CVP income statement for 2017 based on management’s estimates.
BRAMBLE COMPANY
CVP Income Statement (Estimated)

For the Month Ended December 31, 2017December 31, 2017For the Year Ending December 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

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

$

Compute the break-even point in (1) units and (2) dollars.
(1) Compute the break-even point

units
(2) Compute the break-even point $

Compute the contribution margin ratio and the margin of safety ratio. (Round variable cost per bottle to 3 decimal places, e.g. 0.255 and final answers to 0 decimal places, e.g. 25%.)
Contribution margin ratio

%
Margin of safety ratio

%
Determine the sales dollars required to earn net income of $254,000.
Required sales dollars $

0 0
Report
Answer #1

1840000 Required: A Bramble Company CVP Income Statement (Estimated) For the Year Ending December 31, 2017 Sales Variable exp

Required: B Variable cost per bottel percentage = (Total variable cost/Sales) *100 Total Vaiable cost 1104000 Sales 1840000 V

Required: Contribution margin ratio = Contribution margin / Sales Contribution margin 0.20 Sales 0.50 Contribtuion margin rat

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