The Noble Company manufactures two products. Information about the two products are as follows: Product A Product B $80 $45 $30 $15 Selling price per unit Variable cost per unit Contribution margin per unit $35 The company expects fixed costs to be $189,000. The firm expects 60 percent of its sales (in units) to be Product A (a sales mix of 3:2). Required: A. Calculate the contribution margin per package. $_______ B. Determine the break-even point in units for Products A and B. Product A ---units Product B units C. Determine the level of sales (in dollars) necessary to generate operating income of $135,000. $___ $15

The Noble Company manufactures two products. Information about the two products are as follows: Product A Product B $80 $45 $30 $15 Selling price per unit Variable cost per unit Contribution margin per unit $35 The company expects fixed costs to be $189,000. The firm expects 60 percent of its sales (in units) to be Product A (a sales mix of 3:2). Required: A. Calculate the contribution margin per package. $_____ B. Determine the break-even point in units for Products A and B. Product A ---units Product B units C. Determine the level of sales (in dollars) necessary to generate operating income of $135,000. $_ $15

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 7PA: Manatoah Manufacturing produces 3 models of window air conditioners: model 101, model 201, and model...

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Patz Company produces two types of machine parts: Part A and Part B, with unit contribution margins of 300 and 600, respectively. Assume initially that Patz can sell all that is produced of either component. Part A requires two hours of assembly, and B requires five hours of assembly. The firm has 300 assembly hours per week. Required: 1. Express the objective of maximizing the total contribution margin subject to the assembly-hour constraint. 2. Identify the optimal amount that should be produced of each machine part and the total contribution margin associated with this mix. 3. What if market conditions are such that Patz can sell at most 75 units of Part A and 60 units of Part B? Express the objective function with its associated constraints for this case and identify the optimal mix and its associated total contribution margin.
Polaris Inc. manufactures two types of metal stampings for the automobile industry: door handles and trim kits. Fixed cost equals 146,000. Each door handle sells for 12 and has variable cost of 9; each trim kit sells for 8 and has variable cost of 5. Required: 1. What are the contribution margin per unit and the contribution margin ratio for door handles and for trim kits? 2. If Polaris sells 20,000 door handles and 40,000 trim kits, what is the operating income? 3. How many door handles and how many trim kits must be sold for Polaris to break even? 4. CONCEPTUAL CONNECTION Assume that Polaris has the opportunity to rearrange its plant to produce only trim kits. If this is done, fixed costs will decrease by 35,000, and 70,000 trim kits can be produced and sold. Is this a good idea? Explain.
Salvador Manufacturing builds and sells snowboards, skis and poles. The sales price and variable cost for each follows: Their sales mix is reflected in the ratio 7:3:2. If annual fixed costs shared by the three products are $196,200, how many units of each product will need to be sold in order for Salvador to break even?
The Noble Company manufactures two products. Information about the two products is as follows: Product A Product B Selling price per unit $80 $30 Variable costs per unit 45 15 Contribution margin per unit $35 $15 The company expects the fixed costs to be $189,000. The firm expects 60% of its sales (in units) to be of Product A (a sales mix of 3:2). Required: A. Calculate the contribution margin per package.$fill in the blank 1 B. Determine the break-even point in units for Product A and Product B. Product A fill in the blank 2 units Product B fill in the blank 3 units C. Determine the level of sales (in dollars) necessary to generate an operating income of $135,000.$fill in the blank 4
Craylon Manufacturing Company produces two products, X and Y. The following information is presented for both products: X Y Selling price per unit $40 $25 Variable cost per unit 25 15 Total fixed costs are $275,000.Required:a. Calculate the contribution margin for each product.b. Calculate breakeven point in units of both X and Y if the sales mix is 3 units of X for every unit of Y.c. Calculate breakeven volume in total dollars if the sales mix is 2 units of X for every 3 units of Y.
Harrington Corporation produces three products, A, B, and C. Pertinent information on these products is as follows: Product Selling Price per Unit Variable Cost per Unit Fixed Costper Unit DL Hoursper Unit A $ 4.00 $ 1.00 $ 2.00 2 B $ 3.50 $ 0.50 $ 2.00 2 C $ 6.00 $ 2.00 $ 3.00 3 The objective function for a linear program to maximize contribution margin from the set of three products is: Multiple Choice Z = $3A + $2.50B + $5C. Z = A + B + C. Z = A + $0.50B + $2C. Z = $3A + $3B + $4C. Z = $4A + $3.50B + $6C.
Anna Inc. sells two products as follows: Product A Product B Units sold 3,800 4,750 Selling price per unit $300 $450 Variable costs per unit $120 $270 The company has the following fixed costs: Product A, $613,000, Product B, $1,023,000, and common fixed costs of $372,800. Using the above information answer the following questions. What is the package contribution margin? HINT: this is a dollar value so please round to the nearest penny. What is the break-even in packages? How many units of Product A are required to break-even? How many units of Product B are required to break-even?
Blue Company developed the following information for its product: Per Unit Sales price $90 Variable cost 63 Contribution margin $27 Total fixed costs $1,215,000 Required:Answer the following independent questions and show computations using the contribution margin technique to support your answers. How many units must be sold to break even? 2. What is the total sales that must be generated for the company to earn a profit of $60,000?
Anna Inc. sells two products as follows: Product A Product B Units sold 3,800 4,750 Selling price per unit $300 $450 Variable costs per unit $120 $270 The company has the following fixed costs: Product A, $613,000, Product B, $1,023,000, and common fixed costs of $372,800. Using the above information answer the following questions. What is the package contribution margin? What is the break-even in packages? How many units of Product A are required to break-even? How many units of Product B are required to break-even?
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Bloom Company management predicts that it will incur fixed costs of $267,000 and earn pretax income of $353,100 in the next period. Its expected contribution margin ratio is 53%. Required: 1. Compute the amount of total dollar sales. 2. Compute the amount of total variable costs. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the amount of total dollar sales. Dollar Sales Choose Numerator: / Choose Denominator: = 1 of 5 F8 Next > F9 18 F10 F11 F12 Fn Lock 3:25 PM 6/16/2022 Insert
Use the following information for the next 2 questions (8 & 9). Division X produces and sells a product to external and internal customers. Per-unit information about its operations include: Selling price per unit to external customers $250 Variable manufacturing costs per unit 115 Fixed manufacturing overhead costs per unit 70 8. If X is operating at capacity and has unlimited external customer demand, what should be the minimum transfer price? 9. If X has sufficient excess capacity to meet internal demand, what should be the minimum transfer price?