Acct – sandy bank, inc., makes one model of wooden canoe

Sandy Bank, Inc., makes one model of wooden canoe. Partial information for it follows:
Required:
1. Complete the following table. (Round your “Cost per Unit” answers to 2 decimal places.)

Number of Canoes Produced and Sold
Total costs
Variable Costs
$66,880
Fixed Costs
145,640
Total Costs
$212,520
Cost per Unit
Variable Cost per Unit
Fixed Cost per Unit
Total Cost per Unit

2. Suppose Sandy Bank sells its canoes for $520 each. Calculate the contribution margin per canoe and the
contribution
margin
ratio. (Round
your “percentage” answer to 2 decimal places.)

Unit Contribution Margin

per Canoe

Contribution Margin Ratio

%

3.

This year Sandy Bank expects to sell 810 canoes.
Prepare a contribution margin income statement for the
company.

SANDY BANK, Inc.
Contribution Margin Income Statement
For the Current Year

Contribution Margin

Income from Operations

(Blank spaces on the left can be filled with: Cost of goods sold, fixed costs, gross margin,
interest expense ,net income after taxes, net operating income, sales revenue and variable costs.)
4.

Calculate Sandy Bank’s break-even point in units
and in sales dollars. (Round your intermediate
calculations to 2 decimals. Round your final
answers to the nearest whole number.)

Break-Even Units

Canoes

Break-Even Sales Revenue

5. Suppose Sandy Bank wants to earn $75,000 profit this year. Calculate the number of canoes that
must be sold to achieve this target. (Round your answer to the next whole number.)

Target
Sales
Units

Canoes