Prepare a properly formatted segmented income statement that would be more useful to management in assessing the long-run profitability of the various product lines.TotalsDirt BikesMountain Bikes Racing BikesContribution margin (loss)Traceable fixed expenses:Total traceable fixed expensesProduct line segment margin (loss)Net operating income (loss)< Required 2Required 3 >< Prev2 of 5Next >.... .....I The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales andexpenses for the past quarter follow:MountainRacing Bikes$ 60,00033,00027,000TotalDirt BikesBikesSales$ 300,000120,000180,000$ 90,00027,00063,000$ 150,00060,000Variable manufacturing and selling expensesContribution marginFixed expenses:Advertising, traceableDepreciation of special equipmentSalaries of product-line managersAllocated common fixed expenses*Total fixed expenses90,00010,0006,00012,00018,00014,0009,00013,00030,00066,0006,0008,00010,00012,00036,00030,00023,00035,00060,000148,00046,000Net operating income (loss)$ 32,000$ 17,000$ 24,000$ (9,000)*Allocated on the basis of sales dollars.Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or notthe line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out.Aloxt

The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Mountain Racing Bikes $ 60,e00 33, еее Bikes Total $ 300,000 120,000 180, e00 Dirt Bikes Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses $ 90,000 27,000 63,000 $ 150,eeе 60,000 90,000 27,000 30,000 23,000 35,000 60,000 10,e00 6,000 12,000 18,000 46,000 14, еее 9,000 13,000 30,e00 66,000 6,000 8,e00 10, e00 12,еее 36, еее $ (9,000) 148,e00 Net operating income (loss) $ 32,000 $ 17,000 $ 24,000 "Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out.

The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Mountain Racing Bikes $ 60,e00 33, еее Bikes Total $ 300,000 120,000 180, e00 Dirt Bikes Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses $ 90,000 27,000 63,000 $ 150,eeе 60,000 90,000 27,000 30,000 23,000 35,000 60,000 10,e00 6,000 12,000 18,000 46,000 14, еее 9,000 13,000 30,e00 66,000 6,000 8,e00 10, e00 12,еее 36, еее $ (9,000) 148,e00 Net operating income (loss) $ 32,000 $ 17,000 $ 24,000 "Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out.

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

Relevant costsHigh Frequency manufactures and sells wireless headphones. Information on last year’s operations (sales and production of last year’s model) follows. Sales price per unit $77 Costs per unit Direct material $18 Direct labor 15 Overhead (50% variable) 13 Selling costs (40% variable) 22 Production in units 11,000 Sales in units 10,450 In April of the current year, the new model is in production, and it renders last year’s model obsolete. If the remaining 500 units of of last year’s model are to be sold through regular channels, what is the minimum price per unit, that the company would accept for the headphones? $
The Regal Cycle Company manufactures three types of bicycles—a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Total Dirt Bikes Mountain Bikes Racing Bikes Sales $ 926,000 $ 269,000 $ 405,000 $ 252,000 Variable manufacturing and selling expenses 468,000 111,000 206,000 151,000 Contribution margin 458,000 158,000 199,000 101,000 Fixed expenses: Advertising, traceable 69,800 8,800 40,700 20,300 Depreciation of special equipment 43,700 20,400 7,400 15,900 Salaries of product-line managers 114,200 40,700 38,400 35,100 Allocated common fixed expenses* 185,200 53,800 81,000 50,400 Total fixed expenses 412,900 123,700 167,500 121,700 Net operating income (loss) $ 45,100 $ 34,300 $ 31,500 $ (20,700) *Allocated on the basis of sales dollars. Management is considering discontinuing the racing bikes. The special equipment used to produce racing bikes has no resale value and does not wear out. Required:…
The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses Net operating income (loss) *Allocated on the basis of sales dollars. Total $ 917,000 470,000 447,000 70,400 43,500 114,500 183,400 411,800 $ 35,200 Dirt Bikes $ 265,000 116,000 149,000 8,700 20,300 40,100 53,000 122,100 $ 26,900 Mountain Bikes $ 400,000 202,000 198,000 40,800 7,800 38,200 80,000 166,800 $ 31,200 Racing Bikes $ 252,000 152,000 100,000 Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? 2. Should the production and sale of racing bikes be discontinued? 20,900 15,400 36,200 50,400 122,900 $ (22,900) Management is concerned…
The Regal Cycle Company manufactures three types of bicycles—a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Total Dirt Bikes Mountain Bikes Racing Bikes Sales $ 925,000 $ 265,000 $ 402,000 $ 258,000 Variable manufacturing and selling expenses 466,000 111,000 195,000 160,000 Contribution margin 459,000 154,000 207,000 98,000 Fixed expenses: Advertising, traceable 69,000 8,200 40,500 20,300 Depreciation of special equipment 43,200 20,100 7,700 15,400 Salaries of product-line managers 114,400 40,400 38,900 35,100 Allocated common fixed expenses* 185,000 53,000 80,400 51,600 Total fixed expenses 411,600 121,700 167,500 122,400 Net operating income (loss) $ 47,400 $ 32,300 $ 39,500 $ (24,400) *Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not the line should be discontinued.…
The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses Net operating income (loss) *Allocated on the basis of sales dollars. Total $ 935,000 467,000 468,000 69,800 43,800 114,300 187,000 414,900 $ 53,100 Dirt Bikes $ 269,000 115,000 154,000 8,800 20, 300 40, 600 Mountain Bikes $ 408,000 200,000 208,000 40,800 8,000 38,200 53,800 81,600 123,500 168,600 $ 30,500 $ 39,400 Racing Bikes $ 258,000 152,000 106,000 Required: 1. What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? 2. Should the production and sale of racing bikes be discontinued? 20, 200 15,500 35,500 51,600 122,800 $ (16,800) Management is considering…
Define the following terms with example. RELEVANT COSTSUNK COSTOPPORTUNITY COSTAVOIDABLE AND UNAVOIDABLE COSTINCREMENTAL COSTBREAK-EVEN POINT(B)KPR manufactures installs lawn sod in home yards. The company’s most recent monthly contribution format income statement follows: In RsAmount Sales 80,000 Variable expenses 32,000 Contribution margin 48,000 Fixed expenses -38,000 Net operating income 10,000 Required:Compute the company’s degree of operating leverage.Using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in sales.Verify your estimate from part (2) above by constructing a new contribution format income statement for the company assuming a 5% increase in sales.
Benson Trophies makes and sells trophies it distributes to little league ballplayers. The company normally produces and sells between 6,000 and 12,000 trophies per year. The following cost data apply to various activity levels: Required Complete the following table by filling in the missing amounts for the levels of activity shown in the first row of the table. Note: Round "Cost per unit" answers to 2 decimal places. Number of Trophies Total costs incurred Fixed Variable 6,000 8,000 10,000 12,000 S 78,000 $ 78,000 $ 78,000 $ 42,000 56,000 70,000 78,000 84,000 $ 120,000 $134,000 $ 148,000 $ 162,000 Total costs Cost per unit Fixed $ 13.00 Variable 7.00 Total cost per trophy $ 20.00 $ 0.00 $ 0.00 $ 0.00
The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow. Dire Bikes Bikes $ 921, 000 s265,0 s 404,000 S 252,000 Hountain Racing Bikes Total sales variable manufacturing and selling expenses 447,000 150,e0 16,0 contribution nargin Fixed expenses: Advertising, traceable Depreciation of special equipnent salaries of product-1ine managers Allocated comnon fixed expenses Total fixed exxpenses 101,000 8,900 44,00e 20,see 114,300 40,100 184, 200 53,800 412,Gee 1 00 40,400 7,500 38,100 se, see 166,s00 122,600 24,400 $ 26,100 S 29,200 $(21,600) 20,00 16,00e 35,400 50,400 70,100 Net operating 1ncone (loss) "Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not…
Please help on all 3 requirements
The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Total $ 932,000 471,000 461,000 Dirt Bikes $ 265,000 118,000 147,000 69,700 44,000 115,700 186,400 415,800 $ 45,200 Mountain Bikes Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment. Salaries of product-line managers. Allocated common fixed expenses* Total fixed expenses Net operating income (loss) *Allocated on the basis of sales dollars. Management is concerned about the continued losses shown by the racing bikes and wants a recommendation as to whether or not the line should be discontinued. The special equipment used to produce racing bikes has no resale value and does not wear out. $ 408,000 200,000 208,000 Racing Bikes $ 259,000 153,000 106,000 9,000 40,300 20,400 20,900 8,000 15,100 40,700 38,400 36,600 53,000 81,600 51,800…
The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses Net operating income (loss) *Allocated on the basis of sales dollars. Total $ 300,000 120,000 180,000 30,000 23,000 35,000 60,000 148,000 $ 32,000 Dirt Bikes $ 90,000 27,000 63,000 Complete this question by entering your answers in the tabs below. Required 1 10,000 6,000 12,000 18,000 46,000 $ 17,000 Mountain Bikes $ 150,000 60,000 90,000 14,000 9,000 13,000 30,000 66,000 $ 24,000 Required 2 Required 3 What is the financial advantage (disadvantage) per quarter of discontinuing the Racing Bikes? Racing Bikes $ 60,000 33,000 27,000 Management is concerned about the continued losses shown by the…
A-6