Petes pet products is a sole proprietorship owned by pete, Ask an Expert

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Pete's Pet Products is a sole proprietorship owned by Pete Thompson. The store provides a full-line of pet products, including food, grooming materials, toys, leashes, etc. The company also sells hand-made pet houses, including dog houses, bird cages, and cat castles. Each of the pet houses is being evaluated in terms of cost-volume-profit. See the relevant information below:

Dog House Bird Cage Cat Castle

Sales Price $140 $95 $160
Variable Cost $65 $34 $56
Fixed monthly cost 30% 25% 45%

Sales Commission - 8% of the sales prices

Sold through distributors - 60%
Average Fixed costs/month - $32,000

Calculate the contribution margin for each pet house. Ignore the sales commission for this computation.
Calculate the monthly break-even units for each pet house. Ignore the sales commission for this computation.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9978915

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