Hey Chegg, I got the 1st question right, but the 2nd and 3rd is wrong. Can you h

Question

Hey Chegg, I got the 1st question right, but the 2nd and 3rd is wrong. Can you help me out and show me the work.

Product Pricing: Single Product
Presented is the 2009 contribution income statement of Colgate Products.

units

COLGATE PRODUCTS
Contribution Income Statement
For Year Ended December 31, 2009 Sales (12,000 units) $1,440,000 Less variable costs Cost of goods sold $480,000 Selling and administrative 132,000 (612,000) Contribution margin 828,000 Less fixed costs Manufacturing overhead 510,000 Selling and administrative 220,000 (730,000) Net income $98,000

Explanation / Answer

(b)

(c)

Contribution per unit = $109 - $59 = $50

Sales volume required to earn a profit of $98000

= (fixed cost + profit)/contribution per unit

= (802000 + 98000) / 50 per unit

= 18000 units

Variable selling and admin. Cost ($132000/12000) $ 11 Variable manufacturing cost ($480000/12000) $ 40 Increasae in variable manufacturing cost $ 8 Revised total variable cost $ 59

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