Product Pricing: Two Products Assume Spindrift Beverage Co. manufactures two products, flavored water and carbonated water, both on the same assembly lines and packaged 30 cans per pack. The predicted sales are 150,000 packs of flavore water and 500,000 packs of carbonated water. The predicted costs for the year are as follows. Variable Costs Fixed Costs Materials Other $200,000 $600,000 150,000 700,000 Flavored water uses 25% of the materials costs and 10% of the other costs. Carbonated water uses 75% of the materials costs and 90% of the other costs. The management of Spindrift desires an annual profit of $450,000. (a) What price should Spindrift charge for each pack if management believes the carbonated water. sells for twice the price of flavored water? Rounds answers to the nearest cent. CDs $ 1.7 DVDs $ 2.04 (b) What is the total profit per product using the selling prices determined in part (a)? Use negative signs with answers, if appropriate. x CDs $ 765,000

Product Pricing: Two Products Assume Spindrift Beverage Co. manufactures two products, flavored water and carbonated water, both on the same assembly lines and packaged 30 cans per pack. The predicted sales are 150,000 packs of flavore water and 500,000 packs of carbonated water. The predicted costs for the year are as follows. Variable Costs Fixed Costs Materials Other $200,000 $600,000 150,000 700,000 Flavored water uses 25% of the materials costs and 10% of the other costs. Carbonated water uses 75% of the materials costs and 90% of the other costs. The management of Spindrift desires an annual profit of $450,000. (a) What price should Spindrift charge for each pack if management believes the carbonated water. sells for twice the price of flavored water? Rounds answers to the nearest cent. CDs $ 1.7 DVDs $ 2.04 (b) What is the total profit per product using the selling prices determined in part (a)? Use negative signs with answers, if appropriate. x CDs $ 765,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

3. Multiple product companies Pet Park International sells cat food and dog food. Its monthly fixed costs average $620,000. Cat food sales represent 80% of the company's total revenue. Dog food sales constitute the remaining 20%. The company has provided the following information expressed on a per-case basis: Cat food Dog food. Selling Contribution Price Margin $16 $40 $30 (a) The total monthly sales revenue required to break-even is $ (Rounded) (b) The total monthly sales revenue required to earn an operating income of $135,000 is $_ (c) The company's margin of safety at a monthly sales level of $2,500,000 is $_ (d) If monthly fixed costs increase by $10,000, the break-even point, expressed in sales dollars, will increase to $
Sales Mix and Break-Even Sales Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $1,008,000, and the sales mix is 20% bats and 80% gloves. The unit selling price and the unit variable cost for each product are as Dragon follows: Unit Selling Price $70 180 a. Compute the break-even sales (units) for the overall enterprise product, E. units Products Unit Variable Cost Bats Gloves $50 110 b. How many units of each product, baseball bats and baseball gloves, would be sold at the break-even point? Baseball bats units Baseball gloves units
Transfer pricingMogi Corp. manufactures one primary product, which is processed through two divisions (P and R). Costs for each division are: P R Variable cost per gallon $3 $15 Fixed cost per gallon* 2 12 * Based on production of 75,000 and 120,000 gallons for P and R respectively. P Division produces 75,000 gallons per month. R Division uses 120,000 gallons per month; of that, 75,000 gallons are purchased internally and 45,000 are purchased externally at $10 per gallon. After processing through R Division, a gallon of final product can be sold for $55.a. What would be P’s transfer price to R Division if the price is set at 180 percent of variable cost? $Answer b. What would be P’s transfer price to R Division if the price is set at 130 percent of full cost? $Answer c. What would be P’s transfer price to R Division if the price is set at market value? $Answer d. What is Mogi Corp.’s operating profit if all 120,000 gallon of final product can be sold for $55 per…
Transfer pricingMogi Corp. manufactures one primary product, which is processed through two divisions (P and R). Costs for each division are: P R Variable cost per gallon $3 $15 Fixed cost per gallon* 2 12 * Based on production of 25,000 and 40,000 gallons for P and R respectively. P Division produces 25,000 gallons per month. R Division uses 40,000 gallons per month; of that, 25,000 gallons are purchased internally and 15,000 are purchased externally at $10 per gallon. After processing through R Division, a gallon of final product can be sold for $55.a. What would be P’s transfer price to R Division if the price is set at 180 percent of variable cost? Answer: 5.4 b. What would be P’s transfer price to R Division if the price is set at 130 percent of full cost? Answer: 6.5 c. What would be P’s transfer price to R Division if the price is set at market value? Answer: 10 d. What is Mogi Corp.’s operating profit if all 40,000 gallon of final product can be sold for $55…
Product Profitability Analysis 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: Conquistador Hurricane Sales price $5,400 $3,200 Variable cost of goods sold (3,400) (2,140) Manufacturing margin $2,000 $1,060 Variable selling expenses (758) (388) Contribution margin $1,242 $672 Fixed expenses (580) (270) Operating income $662 $402 In addition, the following sales unit volume information for the period is as follows: Conquistador Hurricane Sales unit volume 2,000 1,500 a. Prepare a contribution margin by product report. Compute the contribution margin ratio for each product as a whole percent. Galaxy Sports Inc. Contribution Margin by Product Conquistador Hurricane Sales v 1.380,000 X Variable cost of goods sold v ৪78.600 X MacBook Air
Sales Mix and Break-Even Sales Dragon Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $246,400, and the sales mix is 80% bats and 20% gloves. The unit selling price and the unit variable cost for each product are as follows: Unit Selling Price Unit Variable Cost $80 200 Products Bats Gloves a. Compute the break-even sales (units) for the overall enterprise product, E. units b. How many units of each product, baseball bats and baseball gloves, would be sold at the break-even point? Baseball bats Baseball gloves $60 120 units units
Tequila Mockingbird, Inc., produces and sells 200,000 barrels of a beverage. Selling price per barrel: $500 Variable cost per barrel: $100 Annual fixed cost $500,000 What is the company's contribution margin ratio?
Break-Even in Units Gelbart Company manufactures gas grills. Fixed costs amount to $11,418,000 per year. Variable costs per gas grill are $200, and the average price per gas grill is $500. Required: 1. How many gas grills must Gelbart Company sell to break even? gas grills 2. If Gelbart Company sells 41,785 gas grills in a year, what is the operating income? 3. If Gelbart Company's variable costs increase to $210 per grill while the price and fixed costs remain unchanged, what is the new break-even point? If required, round your answer to the nearest whole number. gas grills
Sales Mix and Break-Even Sales Home Run Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $464,000, and the sales mix is 80% bats and 20% gloves. The unit selling price and the unit variable cost for each product are as follows: Products Unit Selling Price Unit Variable Cost Bats $80 $60 Gloves 200 120 a. Compute the break-even sales (units) for the overall product, E.fill in the blank 1 units b. How many units of each product, baseball bats and baseball gloves, would be sold at the break-even point? Baseball bats fill in the blank 2 units Baseball gloves fill in the blank 3 units
Product Profitability Analysis 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: Conquistador Hurricane Sales price $4,600 $3,000 Variable cost of goods sold (2,900) (2,010) Manufacturing margin $1,700 $990 Variable selling expenses (734) (510) Contribution margin $966 $480 Fixed expenses (450) (190) Operating income $516 $290 In addition, the following sales unit volume information for the period is as follows: Conquistador Hurricane Sales unit volume 3,400 2,500 a. Prepare a contribution margin by product report. Compute the contribution margin ratio for each product as a whole percent. Galaxy Sports Inc. Contribution Margin by Product Conquistador Hurricane…
Mission foods produces two flavors of tacos-chicken and fish- with the following characteristics. a) $1,070,500 B) need help
Sales Mix and Break-Even Sales Home Run Sports Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $397,800, and the sales mix is 40% bats and 60% gloves. The unit selling price and the unit variable cost for each product are as follows: Unit Selling Price Unit Variable Cost Products Bats $50 130 $40 80 Gloves a. Compute the break-even sales (units) for the overall product, E. units b. How many units of each product, baseball bats and baseball gloves, would be sold at the break-even point? Baseball bats Baseball gloves units units