Gilner L. Pomar Jr.

BSA 2-A

AKB Company sold its product last year at a selling price of P200. The company
incurred P150 variable cost per unit of the product and total fixed cost of P15,000,000.
This current year, the company targets an increase in the volume of its sales by
25% of last year’s 500,000 units sold.

INSTRUCTION: Prepare the CONTRIBUTION MARGIN TABLE to compute the operating

income for LAST YEAR AND THIS YEAR and, answer the required items in the LMS
for TEST 3.

LAST YEAR
Description Total (P) PER UNIT Ratio (%)
Sales 100,000,000 200 100%
(Variable Cost) (75,000,000) (150) (75%)
Contribution Margin 25,000,000 50 25%
(Fixed Cost) (15,000,000) 30 (15%)
Operating Income 10,000,000 20 10%
LAST YEAR
TVC = VC per unit x SV
= 150 x 500,000
= 75,000,000

TSV = SP per unit x SV

= 200 x 500,000
= 100,000,000

VCR = TVC/TSV
= 75,000,000/100,000,000
= 75%

FC per unit = FC/SV

= 15,000,000/500,000
= 30

FCR = FC/SR
= 15,000,000/100,000,000
= 15%
 THIS YEAR
Description Total (P) PER UNIT Ratio (%)
Sales 125,000,000 200 100%
(Variable Cost) (93,750,000) 150 75%
Contribution Margin 31,250,000 50 25%
(Fixed Cost) (15,000,000) 24 12%
Operating Income 16,750,000 26 13%
THIS YEAR
TVC = VC per unit x SV
= 150 x 625,000
= 93,750,000

TSV = SP per unit x SV

= 200 x 625,000
= 125,000,000

VCR = TVC/TSV
= 93,750,000/125,000,000
= 75%

FC per unit = FC/SV

= 15,000,000/625,000
= 24

FCR = FC/TSV
= 15,000,000/125,000,000
= 12%