# Project #47016 - Accounting 20 CVP

P20-35A

Kincaid Company sells flags with team logos. Kincaid has fixed costs of \$583,200 per year plus variable costs of \$4.80 per flag. Each flag sells for \$12.00.

1. Prepare a contribution format income statement with columns for the contribution margin per unit and the contribution ratio, as explained in Chapter Materials item, "CVP Analysis for Problem Solving."  A course link is below.

 Total Amount Contribution Margin per Unit Contribution Margin Ratio Net Revenue Less Variable Costs Contribution Margin Less Fixed Costs Operating Income

2. Calculate the break even units and sales dollars.

3. Calculate the number of flags and sales dollars that must be sold to earn \$33,000 in net operating income.

4. Prepare a contribution format income statement for sales of 72,000 flags.

5. The company is considering an expansion that wil increase fixed costs by 21% and variable costsby \$.60 per flag.  Compute the new breakeven point in units and in dollars by creating a new contribution margin analysis, as in #1.  Should Kincaid undertake the expansion?  Why?

 Subject Mathematics Due By (Pacific Time) 11/10/2014 09:30 am
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