Riverside Inc. makes one model of wooden canoe. Partial information for it follows:Number of Canoes Produced and SoldTotal costsVariable costsFixed costs550750900$110,00099,000$150,000$180,00099,000$209,000 $249,000 $279,00099,000Total costsCost per unitVariable cost per unit$ 200.00$ 200.00132.00$ 332.00$ 200.00Fixed cost per unit180.00110.00Total cost per unit$ 380.00310.00Riverside sells its canoes for $460 each. Next year Riverside expects to sell 1,000 canoes.Required:Complete the Riverside's contribution margin income statement for each independent scenario. Assuming each scenario is a variationof Riverside's original data. (Round your unit contribution margin and contribution margin ratio to 2 decimal places (i.e. 1234should be entered as 12.34%) and all other answers to the nearest dollar amount.)Scenario 2 IncreaseScenario 1 RaisesScenario 3Sales Price andVariable Cost perUnit by 10 PercentSales Price to $560Decrease Fixedper CanoeCost by 20 PercentUnit Contribution MarginContribution Margin Ratio%Contribution Margin Income StatementContribution MarginNet Operating Income

The contribution margin is calculated as difference between sales revenue and variable cost.

Answered: Riverside Inc. makes one model of…

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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Sandy Bank, Inc., makes one model of wooden canoe. And, the information for it follows: Number of canoes produced and sold 400 600 750 Total costs Variable costs $ 67,500 $ 101,250 $ 126,563 Fixed costs $ 150,000 $ 150,000 $ 150,000 Total costs $ 217,500 $ 251,250 $ 276,563 Cost per unit Variable cost per unit $ 168.75 $ 168.75 $ 168.75 Fixed cost per unit 375.00 250.00 200.00 Total cost per unit $ 543.75 $ 418.75 $ 368.75 Sandy Bank sells its canoes for $550 each. Required: 1. Suppose that Sandy Bank raises its selling price to $675 per canoe. Calculate its new break-even point in units and in sales dollars. 2. If Sandy Bank sells 650 canoes, compute its margin of safety in dollars and as a percentage of sales. (Use the new sales price of $675.) 3. Calculate the number of canoes that Sandy Bank must sell at $675 each to generate $100,000 profit.
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Riverside Inc. makes one model of wooden canoe. Partial information for it follows: Number of Canoes Produced and Sold 455 605 755 Total costs Variable costs $ 65,065 149,700 $214,765 ? Fixed costs Total costs Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit ? ? ? ? ? Required: 1. Complete the table. 3. Suppose Riverside sells its canoes for $505 each. Calculate the contribution margin per canoe and the contribution margin rati 4. Next year Riverside expects to sell 805 canoes. Complete the contribution margin income statement for the company. Complete this question by entering your answers in the tabs below. Required 1 Required 3 Required 4 Complete the table. (Round your cost per unit answers to 2 decimal places.) Number of Canoes Produced and Sold 455 605 755 Total Costs Variable Costs 2$ 65,065 Fixed Costs 149,700 Total Costs $ 214,765 $ $ Cost per Unit Variable Cost per Unit Fixed Cost per Unit Total Cost per Unit $ 0.00 $ 0.00 $ 0.00 Complete this…
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Donnelly Company has three products, R2, R4, and R2D2. The following information is available: Product R2 Product R4 Product R2D2 Sales $30,000 $45,000 $12,000 Variable Costs 18,000 24,000 7,500 Contribution Margin 12,000 21,000 4,500 Fixed Costs: Avoidable 4,500 9,000 3,000 Unavoidable 3,000 4,500 2,700 Operating Income $4,500 $7,500 $(1,200) Donnelly Company is thinking of dropping Product R2D2 because it is reporting a loss. Assuming Donnelly drops Product R2D2 and does not replace it, what will happen to operating income?
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Manatoah Manufacturing produces 3 models of window air conditioners: model 101, model 201, and model 301. The sales price and variable costs for these three models are as follows: Sales Price Variable Cost per Unit Product per Unit $275 350 395 Model 101 Model 201 Model 301 The current product mix is 4:3:2. The three models share total fixed costs of $657,000. $180 215 240 A. Calculate the sales price per composite unit. Sales price $ B. What is the contribution margin per composite unit? Contribution margin $ per composite unit Break-even point in dollars $ Break-even point in units per composite unit. C. Calculate Manatoah's break-even point in both dollars and units. units
Sandy Bank, Incorporated, makes one model of wooden canoe. And, the information for it follows: Number of canoes produced and sold Total costs Variable costs Fixed costs Total costs Cost per unit Variable cost per unit Fixed cost per unit Total cost per unit Sandy Bank sells its canoes for $375 each. 450 Required 1 Required 2 $ 69,750 $ 468,000 $ 537,750 Required 3 $ 155.00 1,040.00 $ 1,195.00 650 $ 100,750 $ 468,000 $ 568,750 $ 155.00 720.00 $ 875.00 Complete this question by entering your answers in the tabs below. 800 Required: 1. Suppose that Sandy Bank raises its selling price to $500 per canoe. Calculate its new break-even point in units and in sales 2. If Sandy Bank sells 1,500 canoes, compute its margin of safety in dollars and as a percentage of sales. (Use the new sales pr $500) 3. Calculate the number of canoes that Sandy Bank must sell at $500 each to generate $110,000 profit. $ 124,000 $ 468,000 $ 592,000 $ 155.00 585.00 $ 740.00 Suppose that Sandy Bank raises its selling…
Make-or-Buy Decision (LO2) Switzer Corporation makes motorcycle engines. The company’s records show the following units costs to manufacture part #61645: Another manufacturer has offered to supply Switzer Corporation with part #61645 for the costs of $50 per-unit. Switzer uses 1,000 units annually.
The following costs were for Handle Bar Incorporated, a bicycle manufacturer that uses the high-low method. Output 960 Fixed Costs $ 33,000 Total Costs $ 159,720 1,010. $ 33,000 $ 166,320 1,060 $ 33,000 $ 172,920 1,110 $ 33,000 $ 179,520 At an output level of 1.320 bicycles, per unit total cost is calculated to be Multiple Choice $132.00 $133.50 O $157,00 O $161.73. $186.70 Variable Costs $ 126,720 $ 133,320 $ 139,920 $ 146,520
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