Question

Sheffield Company has the following information available for September 2017. Unit selling price of video game consoles Unit variable costs Total fixed costs Units sold $796 $557 $107,550 1,194 Compute the unit contribution margin. Unit contribution margin $

Answer 1

Answer

• Unit Contribution margin = $ 796 – 557 = $ 239

CVP Income Statement
For the month ended Sept 30,2017
	Total	Per unit
Sales [1194 units x $ 796]	$950,424	$796.00
Variable Cost [1194 units x $ 557]	$665,058	$557.00
Contribution margin	$285,366	$239.00
Fixed Cost	$107,550
Net Income (Loss)	$177,816

• Break even point = $ 107550 fixed cost / $ 239 contribution margin per unit
  = 450 units

CVP Income Statement
For the month ended Sept 30,2017
	Total	Per unit
Sales [450 units x $ 796]	$358,200	$796.00
Variable Cost [450 units x $ 557]	$250,650	$557.00
Contribution margin	$107,550	$239.00
Fixed Cost	$107,550
Net Income (Loss)	$0