Beverly High Fashions Company manufactured and sold $1000 pair of leather handbags during July

Select the following data:

Sales                                                                                               $110,000

Direct materials used                                                                           $31,000

Direct Labor                                                                                       $16,000

Variable manufacturing overhead                                                            $13,000

Fixed manufacturing overhead                                                                $11,000

Variable selling & administrative expenses

Selling & administrative expenses

Contribution margin                                                                               $40,000

Operating income                                                                                  $22,000

1. What were the variable selling and administrative expenses for July?

2. What were the fixed selling and administrative expenses for July?

3. What was the cost of goods sold during July?

4. Without prejudice to your earlier answers, assume that the fixed selling and administrative expenses for July amounted to $4000.

a. What was the break-even point in units for July?

b. How many units must be sold to earn a target operating income of $ 14,000?

c. What would the selling price per unit have to be if the company wanted to earn an operating income of $22,500 on the sale of 900 units?