Exercise 6-7B.+Exercise 6-9B Using the contribution margin approach for a special order decisionBenton Company produces and sells a food processor that it prices at a 32 percent markup on totalcost. Based on data pertaining to producing and selling 50,000 food processors, Benton computes thesales price per food processor as follows.Unit-level costs$ 750,000Fixed costs500,000$1,250,000Total cost (a)Markup (a x 0.32)400,000Total sales revenue (b)$1,650,000Sales price per unit (b 50,000)2$33.00RequiredBenton receives a special order for 7,000 food processors for $20 each. Benton has excess capacity.Calculate the contribution margin per unit for the special order. Based on the contribution marginper unit, should Benton accept the special order?a.b. Support your answer by preparing a contribution margin income statement for the special order.Exercise 6-10B Making an outsourcing decisionSwartz Boats Company currently produces a battery used in manufacturing its boats. The company

Contribution margin income statement are as follows.

-Exercise 6-9B Using the contribution margin approach for a special order decision Benton Company produces and sells a food processor that it prices at a 32 percent markup o cost. Based on data pertaining to producing and selling 50,000 food processors, Benton compu sales price per food processor as follows. Unit-level costs $ 750,000 Fixed costs 500,000 $1,250,000 Total cost (a) Markup (a x 0.32) 400,000 Total sales revenue (b) $1,650,000 Sales price per unit (b 50,000) 24 33.00 Required a. Benton receives a special order for 7,000 food processors for $20 each. Benton has excess ca Calculate the contribution margin per unit for the special order. Based on the contribution per unit, should Benton accept the special order? b. Support your answer by preparing a contribution margin income statement for the special o

-Exercise 6-9B Using the contribution margin approach for a special order decision Benton Company produces and sells a food processor that it prices at a 32 percent markup o cost. Based on data pertaining to producing and selling 50,000 food processors, Benton compu sales price per food processor as follows. Unit-level costs $ 750,000 Fixed costs 500,000 $1,250,000 Total cost (a) Markup (a x 0.32) 400,000 Total sales revenue (b) $1,650,000 Sales price per unit (b 50,000) 24 33.00 Required a. Benton receives a special order for 7,000 food processors for $20 each. Benton has excess ca Calculate the contribution margin per unit for the special order. Based on the contribution per unit, should Benton accept the special order? b. Support your answer by preparing a contribution margin income statement for the special o

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Target Costing Laser Cast Inc. manufactures color laser printers. Model J20 presently sells for $150 and has a product cost of $120, as follows: Direct materials $90 Direct labor 20 Factory overhead 10 Total $120 It is estimated that the competitive selling price for color laser printers of this type will drop to $140 next year. Laser Cast has established a target cost to maintain its historical markup percentage on product cost. Engineers have provided the following cost-reduction ideas: 1. Purchase a plastic printer cover with snap-on assembly, rather than with screws. This will reduce the amount of direct labor by 9 minutes per unit. 2. Add an inspection step that will add six minutes per unit of direct labor but reduce the materials cost by $3 per unit. 3. Decrease the cycle time of the injection molding machine from four minutes to three minutes per part. Thirty percent of the direct labor and 42% of the factory overhead are related to running injection molding machines. The…
1. A check involves three parties. The person directed to receive the money is called the a.endorser. b.payee. c.drawer. d.drawee. 2. The time an asset is expected to last is called its a.fiscal period. b.depreciation. c.useful life. d.net loss value. 3. In reconciling a bank statement, the bank statement balance is $1,000 and the balance per books is $1,205. A bank service charge is $5; a deposit in transit totals $500; and outstanding checks total $300. The journal entry for a bank service charge would include a.debiting Cash and crediting Miscellaneous Expense. b.debiting Miscellaneous Expense and crediting Cash. c.debiting Cash and crediting Owner's Capital. d.debiting Accounts Payable and crediting Cash. 4. The journal entry to close revenue accounts includes a.debiting the revenue accounts and crediting the drawing account. b.debiting the revenue accounts and crediting Cash. c.debiting the revenue accounts and crediting Income Summary. d.debiting Income Summary…
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Variable Costs, Contribution Margin, Contribution Margin Ratio Super-Tees Company plans to sell 20,000 T-shirts at $19 each in the coming year. Product costs include: Direct materials per T-shirt $6.65 $1.33 Direct labor per T-shirt Variable overhead per T-shirt $0.57 Total fixed factory overhead $43,000 Variable selling expense is the redemption of a coupon, which averages $0.95 per T-shirt; fixed selling and administrative expenses total $13,000.
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Problem Set: Module 4 1. EX.06.01 2. PR.06.02A.ALGO 3. BE.06.02.ALGO 4. BE.06.03.ALGO engagenow.com + 40 Contribution Margin Harry Company sells 36,000 units at $40 per unit. Variable costs are $34.00 per unit, and fixed costs are $103,700. Determine (a) the contribution margin ratio, (b) the unit contribution margin, and (c) operating income. a. Contribution margin ratio (Enter as a whole number.) b. Unit contribution margin (Round to the nearest cent.) c. Operating income $ : % per unit ?
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