A corporation makes several products. Because of a recent lack of skilled workers, the corporation has had a shortage of available labor hours. The following per unit data pertains to the related products:Selling priceVariable costLabor hours requiredMultiple Choice$12,000The company only has 1,800 labor hours available next month. The company can only sell 800 units of each product a month. What is the maximum amount of contribution margin that it can generate nextmonth?$19,000$19,600LO$30$201$19,800ES$80$406CH$42$202

Labour hours available = 1800 hoursMaximum sales of each product = 800 units

Answered: A corporation makes several products.…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter10: Short-term Decision Making

Section: Chapter Questions

Problem 1PB: Variety Artisans has a bottleneck in their production that occurs within the engraving department....

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Cadre, Inc., sells a single product with a selling price of $120 and variable costs per unit of $90. The companys monthly fixed expenses are $180,000. What is the companys break-even point in units? What is the companys break-even point in dollars? Prepare a contribution margin income statement for the month of October when they will sell 10,000 units. How many units will Cadre need to sell in order to realize a target profit of $300,000? What dollar sales will Cadre need to generate in order to realize a target profit of $300,000? Construct a contribution margin income statement for the month of August that reflects $2,400,000 in sales revenue for Cadre, Inc.
Kerr Manufacturing sells a single product with a selling price of $600 with variable costs per unit of $360. The companys monthly fixed expenses are $72,000. What is the companys break-even point in units? What is the companys break-even point in dollars? Prepare a contribution margin income statement for the month of January when they will sell 500 units. How many units will Kerr need to sell in order to realize a target profit of $120,000? What dollar sales will Kerr need to generate in order to realize a target profit of $120,000? Construct a contribution margin income statement for the month of June that reflects $600,000 in sales revenue for Kerr Manufacturing.
Artisan Metalworks has a bottleneck in their production that occurs within the engraving department. Jamal Moore, the COO, is considering hiring an extra worker, whose salary will be $55,000 per year, to solve the problem. With this extra worker, the company could produce and sell 3,000 more units per year. Currently, the selling price per unit is $25 and the cost per unit is $7.85. Using the information provided, calculate the annual financial impact of hiring the extra worker.
Maple Enterprises sells a single product with a selling price of $75 and variable costs per unit of $30. The companys monthly fixed expenses are $22,500. What is the companys break-even point in units? What is the companys break-even point in dollars? Construct a contribution margin income statement for the month of September when they will sell 900 units. How many units will Maple need to sell in order to reach a target profit of $45,000? What dollar sales will Maple need in order to reach a target profit of $45,000? Construct a contribution margin income statement for Maple that reflects $150,000 in sales volume.
Marlin Motors sells a single product with a selling price of $400 with variable costs per unit of $160. The companys monthly fixed expenses are $36,000. What is the companys break-even point in units? What is the companys break-even point in dollars? Prepare a contribution margin income statement for the month of November when they will sell 130 units. How many units will Marlin need to sell in order to realize a target profit of $48,000? What dollar sales will Marlin need to generate in order to realize a target profit of $48.000? Construct a contribution margin income statement for the month of February that reflects $200,000 in sales revenue for Marlin Motors.
Polaris Inc. manufactures two types of metal stampings for the automobile industry: door handles and trim kits. Fixed cost equals 146,000. Each door handle sells for 12 and has variable cost of 9; each trim kit sells for 8 and has variable cost of 5. Required: 1. What are the contribution margin per unit and the contribution margin ratio for door handles and for trim kits? 2. If Polaris sells 20,000 door handles and 40,000 trim kits, what is the operating income? 3. How many door handles and how many trim kits must be sold for Polaris to break even? 4. CONCEPTUAL CONNECTION Assume that Polaris has the opportunity to rearrange its plant to produce only trim kits. If this is done, fixed costs will decrease by 35,000, and 70,000 trim kits can be produced and sold. Is this a good idea? Explain.
A company has prepared the following statistics regarding its production and sales at different capacity levels. Total costs: 1. At what point is break-even reached in sales dollars? In units? (Hint: Use the capacity level to determine the number of units.) 2. If the company is operating at 60% capacity, should it accept an offer from a customer to buy 10,000 units at 3 per unit?
Reubens Deli currently makes rolls for deli sandwiches it produces. It uses 30,000 rolls annually in the production of deli sandwiches. The costs to make the rolls are: A potential supplier has offered to sell Reuben the rolls for $0.90 each. If the rolls are purchased, 30% of the fixed overhead could be avoided, If Reuben accepts the offer, what will the effect on profit be?
If a company has fixed costs of $6.000 per month and their product that sells for $200 has a contribution margin ratio of 30%, how many units must they sell in order to break even? A. 100 B. 180 C. 200 D. 2,000
Steeler Corporation Is Planning To Sell 100,000 Units For $2.00 Per Unit And Will Break Even At This Level Of Sales. Fixed Expenses Will Be $75,000. What Are The Company's Variable Expenses Per Unit? A. $0.75 B. $1.25 C. $1.10 D. $1.00 The Use Of A Predetermined Overhead Rate In A Job-Order Cost System Makes It Possible To Compute The Total Cost Of A Job Before Production Is Begun. True Of False.
Suppose you manufacture and sell motorcycle helmets. Helmets sell for $25 each. Information about the company’s costs is as follows Variable manufacturing cost per unit $7 Variable selling and administrative cost per unit $3 Fixed manufacturing overhead per month $300,000 Fixed selling and administrative cost per month $600,000 a) Determine the company’s break-even point in units b) Determine the company’s break-even sales volume in $ c) Calculate unit contribution margin d) Determine the sales volume (in $) required for a monthly operating income of $1,300,000 e) Determine the sales volume required to reach an income of $1,300,000 in units of helmets. f) Estimate the company’s monthly operating loss if it sells only 70,000 units of helmets.
Night Shades Inc. (NSI) manufactures biotech sunglasses. The variable materials cost is $1.89 per unit, and the variable labor cost is $3.4 per unit. a. What is the variable cost per unit? b. Suppose the company incurs fixed costs of $790,000 during a year in which total production is 355,500 units. What are the total costs for the year? c. If the selling price is $10.2 per unit, what is the NSI break-even on a cash basis?

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