10 Nov Cost volume profit analysis of managerial accounti
Cost volume profit analysis of managerial accountingAlden company prepared the following budget income statement for the coming yearSales revenue $ 515000 Total variable cost 402950 Contribution Margin 112050 Total Fixed costs 64,800 Operating income 47250Required:1, What is Alden’s variable cost ratio? What is its contribution margin ratio?2, suppose Alden’s actual revenues are $35000 more than budgeted By how much will operating income increase? Give the answer without preparing a new income statement3, How much sales revenue must Alden earn to break even? Prepare a contribution margin income statement to verify the accuracy of your answer4, What is Alden’s expected margin of safety?5, What is Alden’s margin of safety if sales revenue is $380000?
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