COST-VOLUME PROFIT CHART

$1,400,000.00

$1,200,000.00

$1,000,000.00

$800,000.00

$600,000.00
Cost
Operating income

$400,000.00

$200,000.00

$-
0 25,000 50,000 75,000 100,000

$(200,000.00)

$(400,000.00) SALES VOLUME

 A B C D E F
1 Cost-Volume-Profit Analysis
2
3 Fixed Variable
4 Production costs
5 Direct materials $3.00
6 Direct labour 2.00
7 Factory overhead $125,000 1.00
8 Selling expenses
9 Sales salaries & commissions 60,000 1.50
10 Advertising 20,000
11 Miscellaneous selling expense 10,000
12 General expenses
13 Office salaries 36,000
14 Supplies 8,500 2
15 Miscellaneous general expense 5,000
16 $264,500 $9.50
17
18 Projected unit sales 30,000
19 Selling price per unit $20.00
20 Target operating income $140,000
21
22 Contribution margin per unit $10.50
23 Contribution margin ratio 52.50%
24
25 Projected operating income $ 50,500.00
26
27 Break-even point (units) $ 25,190.48
28 Break-even point (sales dollars) $ 503,809.52
29
30 Target operating income (units needed to achieve) $ 38,523.81
31 Target operating income (sales dollars needed to achieve) $ 770,476.19
32
33
34 Unit sales 0 25,000 50000 75000 100000
35 Cost $ 264,500.00 $ 502,000.00 $ 739,500.00 $ 977,000.00 $ 1,214,500.00
36 Operating income $(264,500.00) $ (2,000.00) $ 260,500.00 $ 523,000.00 $ 785,500.00