Solution-Question-francois french cheese

Question-francois french cheese

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Reference no: EM133201847

Francois French manufactures cheese, which he normally sells at €20/kg, on which sales commission of 5% is paid. Plant capacity is 7,500 kg/month. Income tax is levied at 30%.

Fixed costs		Costs per kg.
Plant depreciation	€8,000	Direct materials	€4
Other plant costs	15,000	Direct labor	2
Corporate salaries	10,000	Var. factory O/H	3
Advertising	3,000

If sales are 5,000 kgs, which of the following is true?

A. Total contribution margin is €50,000

B. Ratio of total contribution margin to net income before taxes is 3.57

C. Taxes payable are €4,200

D. Operating leverage is 42%

E. All of the above

Reference no: EM133201847

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Question-francois french cheese

Reference no: EM133201847

Reference no: EM133201847

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