Managerial Accounting Question 1
Use excel or word only. Provide all supporting calculations to show how you arrived at your numbers
Part A: Fixed and Variable Cost
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Order Paper NowStuart Manufacturing produce metals pictures frames. The Companys income statement for the last two years are given below
Last Year This Year
Units Sold 50,000 70,000
Sales $80,000 $1,120,000
Cost of Goods Sold 550,000 710,000
Gross Margin 250,000 410,000
Selling and administrative expense 150,000 190,000
Net Operating Income $100,000 $220,000
The company has no beginning or ending inventories.
Required:
a. Estimate the company’s total variable cost per unit and its total fixed costs per year. (Remember that this is a manufacturing firm.)
b. Compute the company’s contribution margin for this year.
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