Problem - Predicting Cost Behavior, Calculating Contribution Margin and Contribution Margin Ratio, Calculating Profit

Presidio, Inc. produces one model of mountain bike. Partial information for the company follows: Bikes Cost per Unit: 625 800 1050

Bikes Produced and Sold 625 Units 800 Units 1,050 Units

Total costs

Variable costs $125,000

Fixed costs per year

Total costs

Cost per unit

Variable cost per unit

Fixed cost per unit

Total cost per unit $543.75

Required -

1. Complete Presidio's cost data table.

2. Calculate Presidio's contribution margin ratio and its total contribution margin at each sales level indicated in the cost data table assuming the company sells each bike for $650.

3. Calculate net operating income at each of the sales levels assuming a sales price of $650.