Assume the following demand curve: Q = 50,400 – 1,200(P). Variable costs are estimated to be $25.82. Calculate total contribution margin at the optimal price. Round your answer to the nearest dollar.
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- Two competitors have the cost structure shown below. Which of the following statements are true Firm A Firm B Product 1 Units 500 200 Total costs (P1) $50,000 $18,000 Product 2 Units 500 1200 Total costs (P2) $100,000 $144,000 Total costs (P1 + P2) $150,000 $162,000 A. Firm A should lower its price on Product 2 B. Firm B is the low-cost producer. C. Firm B should lower its price on Product 1 and Product 2 D. Firm A is the low-cost producer E. Both A and B are trueDominos is planning to introduce two new pizzas (Cauliflower and Calamari). Financial data related to producing these two new pizzas are summarized in the table below. a. If these two new pizzas are sold such that the ratio of Cauliflowers over Calamaris is 4:3, what is the break-even point? b. If the product mix has changed to five Cauliflowers to five Calamaris, what would happen to the break-even point? c. In order to maximize the profit, which product mix should be pushed? d. If both pizzas must go through the same oven and there are only 30,000 oven hours available per period, which product should be pushed to market? Assume that Cauliflower pizza takes 30 minutes and Calamari pizza takes 15 minutes in the oven. Cauliflower Pizza Calamari Pizza Selling Price $10 $12 Variable Costs $5 $10 Fixed Costs $2,000 $600the price ôf b. What Is the breakeve reduces the amount of particulates emitted into the . c. What other considera 8. Techno Corporation is c variable costs of $5 per turing this item are $14 the item is $10 per unit 30,000 units. ble cost to each casting Spartan produces. The second pro- bas fixed costs of $150,000 and adds $90 of variable cost per casting. What is the break-even quantity beyond which the first a. Techno can substa process is more attractive? What is the difference in total cost if the quantity installing new equ of $60,000. Variab! but, as more of the the annual volum produced is 10,000? Techno buy the n price of the item A A news clipping service is considering modernization. Rather Ahan manually clipping and photocopying articles of inter- est and mailing them to its clients, employees electronically input stories from most widely circulated publications into a database. Each new issue is searched for key words, such as a client's company name, competitors' names,…
- Direct Materials Variances Bellingham Company produces a product that requires seven standard pounds per unit. The standard price is $10.5 per pound. If 5,900 units used 43,000 pounds, which were purchased at $10.08 per pound, what is the direct materials (a) price variance, (b) quantity variance, and (c) cost variance? Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. a. Direct materials price variance $ 18,060 X Favorable b. Direct materials quantity variance $ 106,050 X Unfavorable c. Direct materials cost variance $ 124,110 X Favorable Feedback Check My Work Unfavorable variances can be thought of as increasing costs (a debit). Favorable variances can be thought of as decreasing costs (a credit). Cost variance is the difference between the actual and standard total cost.Suppose the lowest and highest demand levels are updated to 70,000 and 145,000, respectively. What is the expected cost for Option 1 now?The selling price per box for Cynthia's Cookies is $20.24. Fixed costs are $60,000 and the variable cost per box is $10.43. What is the break-even quantity? Round your answer to the nearest whole number. boxes If sales last year were 8,700 boxes, what was the net profit? Round your answer to the nearest dollar. $
- The cost of a manufactured product generally consists of which of the following costs? Direct materials cost and direct labor cost only Direct labor cost, direct materials cost, and factory overhead cost Direct materials cost and factory overhead cost only Direct labor cost and factory overhead cost only Any costs we can possibly think of and bury in someone else’s budgetMadonna’s Burgers is considering making hamburger buns in-house instead of buying them from its supplier. It has estimated the fixed costs for a used over to be $7,000 and the variable costs for the buns to be $0.25. It purchases buns for $0.50 each, and there are no fixed purchase costs. Its annual demand for buns is forecasted to be 15,000. Madonna’s wants to know how many buns it has to make to break even.Lakewood Fashions must decide how many lots of assorted ski wear to order for its three stores. Information on pricing, sales, and inventory costs has led to the following payoff table, in thousands. Order size 2 lots 1 lot 1 lot 3 lots (a) Show a regret table. Order size 2 lots 3 lots Low 13 9 6 Low Demand Medium 16 23 38 High 16 38 61 Demand Medium (b) What decision should be made by the optimist? O 1 lot O2 lots O 3 lots (c) What decision should be made by the conservative? O 1 lot O 2 lots O3 lots (d) What decision should be made using minimax regret? O 1 lot O2 lots O 3 lots High Maximum Regret
- Describes the relationship between profit—which is the difference betweentotal revenue and total (i.e., fixed plus variable) cost—and volume of output?As manager of the St. Cloud Theatre Company, you have decided that concession sales will support themselves. The following table provides the information you have been able to put together thus far. Item % of Revenue Selling Price $1.20 $2.00 $1.00 $1.00 Variable Cost Soft Drink $0.60 24 25 $0.90 $0.30 Wine Coffee 31 Candy $0.35 20 Last year's manager, Scott Ellis, has advised you to be sure to add 10% of variable cost as a waste allowance for all categories. You ostimate labor cost to be $260.00 (5 booths with 2 people each) Even if nothing is sold, your labor cost will be $280.00, so you decide to consider this a fixed cost Booth rental, which is a contractual cost at $80.00 for each booth per night, is also a fixed cost. a) Based on the information available, the per night break-oven point in dollars for the St. Cloud Theatre Company = $(round your response to two decimal places).28. 4.4 The Gorman Manufacturing Company must decide whether to purchase a component part from a supplier or to manufacture the component at its own plant. If demand is high, it would be to Gorman's advantage to manufacture the component. If demand is low, however, Gorman's unit manufacturing cost will be high because of underutilization of equipment. The projected profit in thousands of dollars for Gorman's make-or-buy decision is as follows. Demand Medium $40 $45 Decision Manufacture component Purchase component a. Determine the best decisions using the maximax, maximin, and opportunity loss decision criteria. b. Assume that the probability of low demand is 0.35, of medium demand is 0.35, and of high demand is 0.30. What is the best decision using the expected value criterion and what is the expected value of perfect information? Low $220 $210 High $100 $70
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