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theroyalty theroyalty
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Butler Sales Company is a distributor that has an exclusive franchise to sell a particular product made by another company. Butler Sales Company's traditional format income statements for the last two years are given below:
This YearLast Year
Units sold200,000160,000
Sales revenue$ 1,000,000$ 800,000
Cost of goods sold700,000560,000
Gross margin300,000240,000
Selling and administrative expense210,000198,000
Net operating income$ 90,000$ 42,000


Selling and administrative expense is a mixture of fixed costs and variable costs that vary with respect to the number of units sold.

Required:
a. Estimate the company's variable selling and administration expense per unit, and its total fixed selling and administrative expense per year.
b. Compute the company's contribution margin for this year.

Textbook 
Introduction to Managerial Accounting: Brewer Edition: 9e

Introduction to Managerial Accounting: Brewer Edition: 9e


Edition: 9th
Authors:
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crwille78crwille78
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