Account Problem Solution want Oriole provides environmentally friendly lawn services forhomeowners. Its operating costs are as follows.Depreciation - $1,500 per monthAdvertising - $100Insurance - $4,035 per monthWeed and feed materials - $17 per lawnDirect labor - $3 per lawnFuel - $1 perlawnOriole charges $70 per treatment for the average single-family lawn.Determine the company's break-even point in the number of lawnsserviced permonth.

To calculate the break-even point in the number of lawns serviced per month, we use the break-even…

Answered: Oriole provides environmentally…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 11E

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The Lombard Company produces and sells office-space dehumidifiers to companies that own or rent office space. (a) Lombard’s materials and labor costs for producing the dehumidifiers are $3,000 per unit and the fixed costs of its dehumidifier production plant are $1.85 million. If Lombard sells a dehumidifier for $5,000 per unit, what is its percent contribution margin? Show your work. (b) If Lombard used revenue-based compensation to pay its sales force, what would be a salesperson’s sales credit for selling 20 dehumidifiers at a price of $4,500? Show your work. (c) If Lombard used the profit-based compensation method described in the course to pay its sales force and sets the dehumidifier’s target price at $5,000 per unit, what would be a salesperson’s sales credit for selling 20 dehumidifiers at a price of $4,500? Show your work. (d) Explain the benefit to Lombard’s management of using the profit-based compensation method of Part (c) over revenue-based compensation for…
A 303.
Lisah, Inc., manufactures golf clubs in three models. For the year, the Big Bart line has a net loss of $10,000 from sales $200,000, variable costs $180,000, and fi xed costs $30,000. If the Big Bart line is eliminated, $20,000 of fi xed costs will remain. Prepare an analysis showing whether the Big Bart line should be eliminated.
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Bodine Corp. has a contract to deliver cleaning products to the community center. The contract with the aquatic center states that the first 500 gallons of cleaner will cost $16 per gallon. However, the cost will drop to $12 per gallon for all purchases over 500 gallons. Based on its experience, Bodine Corp. estimates that the center will use 800 gallons of chemicals. What transaction price per gallon should Chlorine use for this contract?
Tim Urban, owner/manager of Urban's Motor Court in Key West, is considering outsourcing the daily room cleanup for his motel to Duffy's Maid Service. Tim rents an average of 50 rooms for each of 365 nights (365 × 50 equals the total rooms rented for the year). Tim's cost to clean a room is $12.50. The Duffy's Maid Service quote is $18.50 per room plus a fixed cost of $25,000 for sundry items such as uniforms with the motel's name.Tim's annual fixed cost for space, equipment, and supplies is $60,000. Based on the given information related to costs for each of the options, the crossover point for Tim =_________ room nights (round your response to the nearest whole number).
Hamlet House makes portable garden sheds that sell for $1,800 each. Costs are as follows: Per Unit Total Direct material $800 Direct labor 90 Variable production overhead 60 Variable selling and administrative cost 50 Fixed production overhead $200,000 Fixed selling and administrative 60,000 a. How many garden sheds must the company sell to break even? b. If Hamlet House’s management wants to earn a pre-tax profit of $200,000, how many garden sheds must be sold? c. If Hamlet House’s management wants to earn a pre-tax profit of $280,000, how many garden sheds must be sold?
Make or Buy Filtration, Inc. manufactures filters for use in secondary water irrigation systems. The costs per unit, for 20,000 filters, are as follows. Direct materials $6.00 Direct labor 7.00 Variable overhead 1.00 Fixed overhead 2.00 Total costs $16.00 Irrigation Products has offered to sell 20,000 filters to Filtration for $16 per filter. If Filtration accepts Irrigation Products’ offer, the facilities used to manufacture filters could be used to produce refrigerator filtration units. Revenues from the sale of refrigerator filtration units are estimated at $54,000, with variable costs amounting to 50% of sales. In addition, $1 per unit of the fixed overhead associated with the manufacture of secondary water irrigation filters could be eliminated. Compute the following: Cost to make filters Answer Cost to buy filters Answer Should Filtration, Inc. accept Irrigation Product’s offer? Yes, the cost to purchase the filters is less than the cost to…
Tim Urban, owner/manager of Urban's Motor Court in Key West, is considering outsourcing the daily room cleanup for his motel to Duffy's Maid Service. Tim rents an average of 50 rooms for each of 365 nights (365 x 50 equals the total rooms rented for the year). Tim's cost to clean a room is $13.00. The Duffy's Maid Service quote is $18.00 per room plus a fixed cost of $26,000 for sundry items such as uniforms with the motel's name. Tim's annual fixed cost for space, equipment, and supplies is $61,000. Based on the given information related to costs for each of the options, the crossover point for Tim = ☐ room nights (round your response to the nearest whole number).
The heat loss from bare steam pipes costs a motel manager $400 annually. Two brands of insulation are available. Brand A will cost $120 and will reduce losses by 93%. Brand B will cost $70 and will reduce losses by 87%. a.) What are the capitalized costs of perpetual service for both brands? b.) Which insulation is superior? Use 10%.
Tim Urban, owner/manager of Urban's Motor Court in Key West, is considering outsourcing the daily room cleanup for his motel to Duffy's Maid Service. Tim rents an average of 50 rooms for each of 365 nights (365 × 50 equals the total rooms rented for the year). Tim's cost to clean a room is $13.00. The Duffy's Maid Service quote is $19.00 per room plus a fixed cost of $26,000 for sundry items such as uniforms with the motel's name. Tim's annual fixed cost for space, equipment, and supplies is $61,000. Based on the given information related to costs for each of the options, the crossover point for Tim = room nights (round your response to the nearest whole number).

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