A manufacturing company decides which of three mutually exclusive products to make in its factory on the basis of maximising the company's throughput accounting ratio.Current data for the three products is shown in the following table:Product XProduct YProduct Z$20Selling price per unit$60$40Direct material cost per unit$40$10$16Machine hours per unit10202.5Total factory costs (excluding direct materials) are $150,000. The company cannot make enough of any of the products to satisfy external demand entirely as machine hours are restricted.Which of the following actions would improve the company's existing throughput accounting ratio?Increase the selling price of product Z by 10%Increase the selling price of product Y by 10%Reduce the material cost of product Z by 5%O Reduce the material cost of product Y by 5%

Throughput return ratio refers to the form of ratio which reflects the comparison between the actual…

decides which of three mutually exclusive products to make in its roducts is shown in the following table Product X Product Y Product Z $60 $40 $20 $40 $10 $16 10 20 2.5 direct materials) are $150,000. The company cannot make en s would improve the company's existing throughput ac f product Z by 10% product Y by 10% product Z by 5% roduct Y by 5%

decides which of three mutually exclusive products to make in its roducts is shown in the following table Product X Product Y Product Z $60 $40 $20 $40 $10 $16 10 20 2.5 direct materials) are $150,000. The company cannot make en s would improve the company's existing throughput ac f product Z by 10% product Y by 10% product Z by 5% roduct Y by 5%

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 1PA: The following product Costs are available for Haworth Company on the production of chairs: direct...

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Galaxy Sports Inc. manufactures and sells two styles of All Terrain Vehicles (ATVs), the Conquistador and Hurricane, from a single manufacturing facility. The manufacturing facility operates at 100% of capacity. The following per-unit information is available for the two products: In addition, the following sales unit volume information for the period is as follows: a. Prepare a contribution margin by product report. Compute the contribution margin ratio for each. b. What advice would you give to the management of Galaxy Sports Inc. regarding the profitability of the two products?
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Fleurant, Inc., manufactures and sells two products: Product W2 and Product P8. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: Expected Production Direct Labor-Hours Per Unit Total Direct Labor-Hours Product W2 400 4 1,600 Product P8 800 2 1,600 Total direct labor-hours 3,200 The direct labor rate is $31.10 per DLH. The direct materials cost per unit is $197.60 for Product W2 and $134.30 for Product P8. The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Expected Activity Activity Cost Pools Activity Measures Overhead Cost Product W2 Product P8 Total Labor-related DLHs $ 212,576 1,600 1,600 3,200 Production orders orders 17,938 420 320 740 Order size MHs 236,686 3,820 3,620 7,440 $ 467,200 If the company…
Subject : Accounting