Prepare a daily contribution margin income statement based

Question

In this segment of our continuing cookie company case, you will classify the costs of the business as variable, fixed, or mixed; use the high-low method to evaluate utility costs; and prepare a contribution margin income statement.

1. Review your cookie recipe and the overhead costs you identified in previous chapters, and classify the costs as variable, fixed, or mixed costs.

2. Obtain your electric bills for three months, and use the high-low method's cost for- mula to determine the monthly cost of electricity-that is, monthly electric cost = variable rate per kilowatt-hour + monthly fixed cost. If you do not receive an electric bill, use the following information:

Month	Kilowatt-Hours Used	electric Costs
August	1,439	$202
September	1,866	230
October	1,146	158

3. a. Prepare a daily contribution margin income statement based on the following assumptions:

My Cookie Company makes only one kind of cookie and sells it for $1.00 per unit. The company projects sales of 500 units per day. Projected daily costs are as follows:

Type of Cost	Manufacturing	nonmanufacturing
Variable	$100	$50
Nonvariable	120	60

b. What is the contribution margin ratio?

c. What volume, in terms of units, must the company sell to break even each day? (Round to the nearest dollar.)

Answer 1

To attain an elevated level of your task need to make it more effective you’re all questions In this segment of our continuing cookie company case, you will categorize the costs of the business as variable, fixed, or mixed; employ the high-low technique to calculate utility costs; and get ready a contribution margin income statement. 1. Review your cookie recipe and the overhead costs you identified in previous chapters, and organize the costs as variable, fixed, or mixed costs. 2. Attain your electric bills for 3 months, and utilize the high-low method's cost formula to find out the monthly cost of electricity-that is, monthly electric cost = variable rate per kilowatt-hour + monthly fixed cost. If you don’t receive an electric bill, utilize the subsequent information: 3. a. Get ready a daily contribution margin income statement based on the subsequent assumptions: My Cookie Company creates only one type of cookie and sells it for $1.00 per unit.