Financial And Managerial Accounting
15th Edition
ISBN: 9781337902663
Author: WARREN, Carl S.
Publisher: Cengage Learning,
expand_more
expand_more
format_list_bulleted
Question
Chapter 25, Problem 21E
a)
To determine
Ascertain the contribution margin by glass type and total company income from operations for the budgeted units of production for Company YG.
b)
To determine
Prepare the analysis for Company YG, to find the product which is most profitable per production bottleneck hour.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Product Decisions Under Bottlenecked Operations
Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $167,000 for the company as a whole. In addition, the following information is available about the three products:
Large
Medium
Small
Unit selling price
$381
$209
$199
Unit variable cost
300
171
175
Unit contribution margin
$ 81
$ 38
$ 24
Autoclave hours per unit
6
4
2
Total process hours per unit
18
8
6
Budgeted units of production
2,600
2,600
2,600
a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production.
Large
Medium
Small
Total
Units…
Product Decisions Under Bottlenecked Operations
Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $159,000 for the company as a whole. In addition, the following information is available about the three products:
Large
Medium
Small
Unit selling price
$122
$220
$398
Unit variable cost
96
180
350
Unit contribution margin
$ 26
$ 40
$ 48
Autoclave hours per unit
2
4
6
Total process hours per unit
4
8
18
Budgeted units of production
3,100
3,100
3,100
a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production.
Large
Medium…
Product Decisions Under Bottlenecked Operations
Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $296,000 for the company as a whole. In addition, the following information is available about the three products:
Large
Medium
Small
Unit selling price
$324
$286
$158
Unit variable cost
255
234
139
Unit contribution margin
$ 69
$ 52
$ 19
Autoclave hours per unit
6
4
2
Total process hours per unit
18
8
6
Budgeted units of production
4,700
4,700
4,700
a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production.
Large
Medium
Small
Total
Units…
Chapter 25 Solutions
Financial And Managerial Accounting
Ch. 25 - Explain the meaning of (A) differential revenue,...Ch. 25 - A company could sell a building for 250,000 or...Ch. 25 - A chemical company has a commodity-grade and...Ch. 25 - A company accepts incremental business at a...Ch. 25 - A company fabricates a component at a cost of...Ch. 25 - Prob. 6DQCh. 25 - In the long run, the normal selling price must be...Ch. 25 - Although the cost-plus approach to product pricing...Ch. 25 - How does the target cost method differ from...Ch. 25 - Prob. 10DQ
Ch. 25 - Lease or sell Plymouth Company owns equipment with...Ch. 25 - Prob. 2BECh. 25 - Make or buy A company manufactures various-sized...Ch. 25 - Replace equipment A machine with a book value of...Ch. 25 - Process or sell Product J19 is produced for 11 per...Ch. 25 - Prob. 6BECh. 25 - Product cost markup percentage Green Thumb Garden...Ch. 25 - Prob. 8BECh. 25 - Differential analysis for a lease or sell decision...Ch. 25 - Prob. 2ECh. 25 - Differential analysis for a discontinued product A...Ch. 25 - Differential analysis for a discontinued product...Ch. 25 - Prob. 5ECh. 25 - Decision to discontinue a product On the basis of...Ch. 25 - Make-or-buy decision Somerset Computer Company has...Ch. 25 - Make-or-buy decision for a service company The...Ch. 25 - Machine replacement decision A company is...Ch. 25 - Differential analysis for machine replacement...Ch. 25 - Sell or process further Calgary Lumber Company...Ch. 25 - Sell or process further Dakota Coffee Company...Ch. 25 - Decision on accepting additional business...Ch. 25 - Accepting business at a special price Box Elder...Ch. 25 - Prob. 15ECh. 25 - Product cost method of product pricing La Femme...Ch. 25 - Product cost method of product costing Smart...Ch. 25 - Target costing Toyota Motor Corporation (TM) uses...Ch. 25 - Target costing Instant Image Inc. manufactures...Ch. 25 - Product decisions under bottlenecked operations...Ch. 25 - Prob. 21ECh. 25 - Total cost method of product pricing Based on the...Ch. 25 - Variable cost method of product pricing Based on...Ch. 25 - Differential analysis involving opportunity costs...Ch. 25 - Differential analysis for machine replacement...Ch. 25 - Differential analysis for sales promotion proposal...Ch. 25 - Prob. 4PACh. 25 - Prob. 5PACh. 25 - Product pricing using the cost-plus approach...Ch. 25 - Differential analysis involving opportunity costs...Ch. 25 - Differential analysis for machine replacement...Ch. 25 - Differential analysis for sales promotion proposal...Ch. 25 - Differential analysis for further processing The...Ch. 25 - Prob. 5PBCh. 25 - Product pricing using the cost-plus approach...Ch. 25 - Analyze Pacific Airways Pacific Airways provides...Ch. 25 - Service yield pricing and differential equations...Ch. 25 - Prob. 3MADCh. 25 - Service yield pricing and differential analysis...Ch. 25 - Aaron McKinney is a cost accountant for Majik...Ch. 25 - Prob. 3TIFCh. 25 - Prob. 4TIFCh. 25 - Accepting service business at a special price If...Ch. 25 - Prob. 6TIFCh. 25 - In differential cost analysis, which one of the...Ch. 25 - Prob. 2CMACh. 25 - Prob. 3CMACh. 25 - Oakes Inc. manufactured 40,000 gallons of Mononate...
Knowledge Booster
Similar questions
- Product pricing and profit analysis with bottleneck operations Hercules Steel Company produces three grades of steel: high, good, and regular grade. Each of these products (grades) has high demand in the market, and Hercules is able to sell as much as it can produce of all three. The furnace operation is a bottleneck in the process and is running at 100% of capacity. Hercules wants to improve steel operation profitability. The variable conversion cost is 15 per process hour. The fixed cost is 200,000. In addition, the cost analyst was able to determine the following information about the three products: The furnace operation is part of the total process for each of these three products. Thus, for example, 4.0 of the 12.0 hours required to process High Grade steel are associated with the furnace. Instructions 1. Determine the unit contribution margin for each product. 2. Provide an analysis to determine the relative product profitability, assuming that the furnace is a bottleneck.arrow_forwardProduct Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $85,000 for the company as a whole. In addition, the following information is available about the three products: Large Medium Small Unit selling price $184 $160 $100 Unit variable cost 130 120 76 Unit contribution margin $ 54 $ 40 $ 24 Autoclave hours per unit 3 2 1 Total process hours per unit 5 4 2 Budgeted units of production 3,000 3,000 3,000 a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production. Round the "Unit contribution margin per…arrow_forwardProduct decisions under bottlenecked operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $85,000 for the company as a whole. In addition, the following information is available about the three products: a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production.b. Prepare an analysis showing which product is tile most profitable per bottleneck hour.arrow_forward
- Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $154,000 for the company as a whole. In addition, the following information is available about the three products: Large Medium Small Unit selling price $6 $413 $448 Unit variable cost (52) (338) (394) Unit contribution margin $ 14 $ 75 $ 54 Autoclave hours per unit 2 6 4 Total process hours per unit 6 12 8 Budgeted units of production 2,400 2,400 2,400 a. Determine the contribution margin by glass type and the total company operating income for the budgeted units of production. Large Medium Small Total Units produced Revenues $4 Variable costs Contribution margin %4 Fixed…arrow_forwardProduct Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $176,000 for the company as a whole. In addition, the following information is available about the three products: Line Item Description Large Medium Small Unit selling price $254 $143 $266 Unit variable cost (200) (117) (234) Unit contribution margin $ 54 $ 26 $ 32 Autoclave hours per unit 6 2 4 Total process hours per unit 12 4 12 Budgeted units of production 3,500 3,500 3,500 a. Determine the contribution margin by glass type and the total company operating income for the budgeted units of production. Line Item Description Large…arrow_forwardProduct Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $91,000 for the company as a whole. In addition, the following information is available about the three products: Unit selling price Unit variable cost Unit contribution margin Autoclave hours per unit Total process hours per unit Budgeted units of production Large Medium Small $240 $94 $199 (189) (77) (175) $ 51 $ 17 $ 24 6 2 4 18 4 8 2,200 2,200 2,200 a. Determine the contribution margin by glass type and the total company operating income for the budgeted units of production. Large Medium Small Units produced Revenues Variable costs Contribution margin Fixed costs…arrow_forward
- Product Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $148,000 for the company as a whole. In addition, the following information is available about the three products: Large Medium Small Unit selling price $226 $165 $208 Unit variable cost 178 135 183 Unit contribution margin $ 48 $ 30 $ 25 Autoclave hours per unit 6 4 2 Total process hours per unit 18 8 6 Budgeted units of production 3,200 3,200 3,200 a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production. Large Medium…arrow_forwardProduct Decisions Under Bottlenecked Operations Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $339,000 for the company as a whole. In addition, the following information is available about the three products: Large Medium Small Unit selling price $216 $116 $647 Unit variable cost (170) (95) (569) Unit contribution margin $ 46 $ 21 $ 78 Autoclave hours per unit 4 2 6 Total process hours per unit 12 4 12 Budgeted units of production 5,200 5,200 5,200arrow_forwardProduct decisions under bottlenecked operationsYoungstown Glass Company manufactures three types of safety plateglass: large, medium, and small. All three products have high demand.Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is apressurized heat treatment. The autoclave is a production bottleneck.Total fixed costs are $85,000 for the company as a whole. In addition, thefollowing information is available about the three products: Large Medium Small Unit selling price Unit variable cost Unit contribution margin Autoclave hours per unit Total process hours per unit Budgeted units of production $184 130 $54 3 5 3000 $160 120 $40 2 4 3000 $100 76 $24 1 2 3000 a. Determine the contribution margin by glass type and the totalcompany income from operations for the budgeted units of production.b. Prepare an analysis showing which product is tile most profitable perbottleneck hour.arrow_forward
- can someone check and see if i did this right?arrow_forwardYoungstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass that it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $85,500 for the company as a whole. In addition, the following information is available about the three products: Large Medium Small Unit selling price $182 $160 $98 Unit variable cost 131 125 76 Unit contribution margin 51 35 22 Autoclave hours per unit 3 2 1 Total process hours per unit 5 4 2 Budgeted units of production 3,000 3,000 3,000 Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production. Prepare an analysis showing which product is the most profitable per…arrow_forwardYoungstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $293,000 for the company as a whole. In addition, the following information is available about the three products: Large Medium Small Unit selling price $179 $396 $191 Unit variable cost 141 324 168 Unit contribution margin $ 38 $72 $23 Autoclave hours per unit 4 6 2 Total process hours per unit 12 12 6 Budgeted units of production 4,900 4,900 4,900 a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production. Large Medium Small Total Units produced fill in the blank 1 fill in the blank 2…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub