Werner Company produces and sells disposable foil baking pans to retailers for $2.65 per pan. The variable cost per pan is as follows:Direct materialsDirect laborVariable factory overheadVariable selling expenseFixed manufacturing cost totals $143,704 per year. Administrative cost (all fixed) totals $19,596.Required:$0.270.510.690.18Compute the number of pans that must be sold for Werner to break even.pansConceptual Connection: What is the unit variable cost? What is the unit variable manufacturing cost? Round your answers to the nearest cent.Unit variable costUnit variable manufacturing costWhich is used in cost-volume-profit analysis?Unit variable cost ✓How many pans must be sold for Werner to earn operating income of $7,000?pansHow much sales revenue must Werner have to earn operating income of $7,000?

The break even sales are calculated as fixed costs divided by contribution Margin Ratio. The…

Direct materials Direct labor Variable factory overhead Variable selling expense Fixed manufacturing cost totals $143,704 per year. Administrative cost (all fixed) totals $19,596. Required: Compute the number of pans that must be sold for Werner to break even. pans $0.27 0.51 0.69 0.18 Conceptual Connection: What is the unit variable cost? What is the unit variable manufacturing cost? Round your answers to the nearest cent Unit variable cost Unit variable manufacturing cost Which is used in cost-volume-profit analysis? Unit variable cost ✓ How many pans must be sold for Werner to earn operating income of $7,000? pans How much sales revenue must Werner have to earn operating income of $7,000?

Direct materials Direct labor Variable factory overhead Variable selling expense Fixed manufacturing cost totals $143,704 per year. Administrative cost (all fixed) totals $19,596. Required: Compute the number of pans that must be sold for Werner to break even. pans $0.27 0.51 0.69 0.18 Conceptual Connection: What is the unit variable cost? What is the unit variable manufacturing cost? Round your answers to the nearest cent Unit variable cost Unit variable manufacturing cost Which is used in cost-volume-profit analysis? Unit variable cost ✓ How many pans must be sold for Werner to earn operating income of $7,000? pans How much sales revenue must Werner have to earn operating income of $7,000?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints

Section: Chapter Questions

Problem 3CE: Patz Company produces two types of machine parts: Part A and Part B, with unit contribution margins...

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Patz Company produces two types of machine parts: Part A and Part B, with unit contribution margins of 300 and 600, respectively. Assume initially that Patz can sell all that is produced of either component. Part A requires two hours of assembly, and B requires five hours of assembly. The firm has 300 assembly hours per week. Required: 1. Express the objective of maximizing the total contribution margin subject to the assembly-hour constraint. 2. Identify the optimal amount that should be produced of each machine part and the total contribution margin associated with this mix. 3. What if market conditions are such that Patz can sell at most 75 units of Part A and 60 units of Part B? Express the objective function with its associated constraints for this case and identify the optimal mix and its associated total contribution margin.
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Rundle Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,300 containers follows. Unit-level materials. Unit-level labor Unit-level overhead Product-level costs* Allocated facility-level costs One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Rundle for $2.60 each. Required a. Calculate the total relevant cost. Should Rundle continue to make the containers? b. Rundle could lease the space it currently uses in the manufacturing process. If leasing would produce $11,600 per month, calculate the total avoidable costs. Should Rundle continue to make the containers? Answer is complete but not entirely correct. $ a. Total relevant cost a. Should Rundle continue to make the containers? b. Total avoidable cost b. Should Rundle continue to make the containers? 190.650,000 Yes $24,180,000 $ 5,200 6,100 4,000 7,800…
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Tara produces color cartridges for inkjet printers. Suppose cartridges are sold to mail-order distributors for $12 each and that manufacturing and other costs are as follows: Variable Cost per Unit Direct material Direct labor Factory overhead Distribution Total Fixed Cost per Month $4.00 Factory overhead 0.40 Selling and administrative 0.50 0.10 $5.00 Total $17,000 8,000 $25,000 and pointurons The variable distribution costs are for transportation to mail-order distributors. Also assume the current monthly production and sales volume is 20,000 and monthly capacity is 25,000 units. If the sales price per unit increases by $2.00 and unit sales decrease by 2,000 units, Tara's monthly profit would:
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Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,320 remotes is as follows: Direct materials Direct labor Variable overhead Fixed overhead Total Cost $ 67,080 $ 56,760 $ 30,960 $ 51,600 $ 206,400 Frannie is approached by Lincoln Company, which offers to make the remotes for $18 per unit. Required: 1. Compute the difference in cost per unit between making and buying the remotes if none of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 2. Compute the difference in cost per unit between making and buying the remotes if $20,640 of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 3. What is the change in net income if fixed cost of $20,640 can be avoided and Frannie could rent out the factory space no longer in use for $20,640?
Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,280 remotes is as follows: Direct materials Direct labor Variable overhead Fixed overhead Total Cost $ 66,820 $56,540 $ 30,840 $ 51,400 $ 205,600 Frannie is approached by Lincoln Company, which offers to make the remotes for $18 per unit. Required: 1. Compute the difference in cost per unit between making and buying the remotes if none of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 2. Compute the difference in cost per unit between making and buying the remotes if $20,560 of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 3. What is the change in net income if fixed cost of $20,560 can be avoided and Frannie could rent out the factory space no longer in use for $20,560? Complete this question by entering your answers in the tabs below. Required 1 Required 2…
Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,020 remotes is as follows: Direct materials Direct labor Variable overhead Fixed overhead Total Frannie is approached by Lincoln Company, which offers to make the remotes for $18 per unit. Required: Cost 10 $ 65,130 $ 55,110 $ 30,060 $ 50,100 $ 200,400 1. Compute the difference in cost per unit between making and buying the remotes if none of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 2. Compute the difference in cost per unit between making and buying the remotes if $20,040 of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 3. What is the change in net income if fixed cost of $20,040 can be avoided and Frannie could rent out the factory space no longer in use for $20,040? Complete this question by entering your answers in the tabs below. Required 1 Required…
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