Native Wood Products Ltd sells hand-made coffee tables. The shop owner has divided sales into two categories according to the type of wood used in the tables, as follows:Product typeKahikateaRimuSales price$2,000$1,200Costs$1,200$520Sales commission$100$60Seventy percent (70%) of the shop's sales are rimu tables. The shop's annual fixed costs are $161,000.Calculate the weighted average contribution margin, assuming the sales mix stays the same.

Contribution margin is that portion of sales that is available to contribute to the fixed cost and…

Answered: Native Wood Products Ltd sells…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

Native Wood Products Ltd sells hand-made coffee tables. The shop owner has divided sales into two categories according to the type of wood used in the tables, as follows:

Product type	Kahikatea	Rimu
Sales price	$2,000	$1,200
Costs	$1,200	$520
Sales commission	$100	$60

Seventy percent (70%) of the shop's sales are rimu tables. The shop's annual fixed costs are $161,000.

Calculate the weighted average contribution margin, assuming the sales mix stays the same.

Expert Solution

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions