Question

Presidio, Inc. produces one model of mountain bike. Partial information for the company follows: Required: 1. Complete Presidio's cost data table. (Round your Cost per Unit answers to 2 decimal places.) Bikes Produced and Sold 510 Units 890 Units 1862 Units Total costs Variable costs $ 147,900 Fixed costs per year Total costs Cost per unit $ 147,900 $ 0 $ Variable cost per unit Fixed cost per unit Total cost per unit $ 0.00 $ 553.00 $ 0.00 2. Calculate Presidio's contribution margin ratio and its total contribution margin at each sales level indicated in the cost data table assuming the company sells each bike for $640. (Round your Margin Ratio percentage answers to 2 decimal places (i.e. .1234 should be entered as 12.34%.)) 510 Units 890 Units 1862 Units Total Contribution Margin Contribution Margin Ratio 3. Calculate net operating income (loss) at each of the sales levels assuming a sales price of $640. (Round your answers to the nearest whole dollar amount.) 510 Units 890 Units 1862 Units Net Operating Income (Loss)

Answer 1

890 Units 1862 Units Bikes Produced and Sold 510 Units Total Costs Variable Costs Fixed Costs per year 1,47,900 2,34,070 $ 2,58,100 $ 2,34,070 ($263 * 890 units) $ 16,57,180 $ 2,34,070 Total Costs Cost per unit Variable Costs per unit $ 290 $ 290 $ 290 ($1,47,900/510 units $ 458.96 Fixed Costs per unit 263 $ 125.71 $ ($553 - $290) $ Total Cost per unit 748.96 553 $ 415.71

Total Contribution Margin Contribution Margin Ratio 510 Units 890 Units 1862 Units 1,78,500 3,11,500 6,51,700 54.69% 54.69% 54.69% ($178,500/$326,400 * 100) ($311,500/$569,600 * 100) ($651,700/$1,191,680 * 100) (Calculation on Next Screenshot)

A D 2 3 Sales 4 Less: Variable Cost 5 Contribution Margin 5 Less: Fixed Cost 7 Net Operating Income (Loss) 510 Units $ 3,26,400 (510 * $640) | $ 1,47,900 (510 * $290) $ 1,78,500 $ 2,34,070 $ -55,570 890 Units $ 5,69,600 (890 * $640) $ 2,58,100 (890 * $290) $ 3,11,500 $ 2,34,070 $ 77,430 1862 Units $ 11,91,680 (1862 * $640) $ 5,39,980 (1862 * $290) $ 6,51,700 $ 2,34,070 $ 4,17,630 B