Chile's, Inc. currently produces and sells 4,000 units of a product that has a contribution margin of $6 per unit. The company sells the product for a sales price of $20 per unit. Fixed costs are $18,000. The company has considering investing in new technology that would decrease the variable cost per unit to $8 per unit and increase fixed costs to $33,000. The company expects the new technology to increase production and sales to 9,000 units of product. ?What sales price would have to be charged to earn a $93,000 target profit $8 O $16 O $22 $18 $20
Q: Gelb Company currently manufactures 40,000 units per year of a key component for its manufacturing…
A: Given information is: Gelb Company currently manufactures 40,000 units per year of a key component…
Q: Explain whether both managers are justified in their arguments. How can the Components Division…
A: Transfer price is the price for goods and services, at which these are transferred between different…
Q: what is the incremental effect on the company’s net income?
A:
Q: Magenta Company has a Components Division which currently manufactures 120,000 units of Part AAM but…
A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…
Q: Neptune Company has developed a small inflatable toy that it is anxious to introduce to its…
A: break-even analysis is the the target profit analysis. Under this approach we compute the…
Q: Franklin Company, which produces and sells a small digital clock, bases its pricing strategy on a 35…
A: Contribution margin is computed by subtracting the variable cost of production from the sales price.
Q: Unit Costs: DM P20 DL 28 Other Variable Expenses Allocated Facility-level Costs 2 10 P60 Total Unit…
A: A: Total cost to make the component Total Variable Cost= Direct Material +Direct Labour+other…
Q: a) Prepare the incremental analysis for the decision to make or buy the finials. (b) Should Ralph…
A: Incremental Analysis Incremental analysis compares true cost between available alternatives. This…
Q: A moped company produces 200,000 units a year and expects output levels to remain steady in the…
A: IRR is a technique of capital budgeting which helps in decision making with regards to selection of…
Q: The Austin Electric Company has three product lines of surge protectors commonly used in PC and…
A: a) Compute the company’s breakeven point in units assuming sales mix as shown below:
Q: The Monde Company makes a juice cooler with a capacity of 24 bottles. Each juice cooler sells for…
A: The question is based on the concept of cost volume profit analysis and calculation of Breakeven…
Q: NUBD Co. has only 25,000 hours of machine time each month to manufacture its two products. Product X…
A: In the given question, the number of machine hours is limited and is absence of any information, it…
Q: Gilberto Company currently manufactures 78,000 units per year of one of its crucial parts. Variable…
A: Given: Manufacture units = 78000 per year Variable cost = $2.60 per unit Fixed cost (making this…
Q: Neptune Company has developed a small Inflatable toy that it is anxlous to Introduce to Its…
A: Formulas:
Q: Your Company manufactures and sells a single product. The product sells for $1,750 per unit and has…
A: Required number of sales is calculated as sum of fixed cost and desired profit divided by…
Q: Gelb Company currently manufactures 40,000 units per year of a key component for its manufacturing…
A: The decision to manufacture or buy needs to be taken on the basis of impact of cost changes arising…
Q: Farrow Co. expects to sell 150,000 units of its product in the next period with the following…
A: Incremental income refers to the extra incomes from an extra quantity sold. It is like marginal…
Q: The Austin Electric Company has three product lines of surge protectors commonly used in PC and…
A: a) Compute the company’s breakeven point in units assuming sales mix as shown below:
Q: Lingkod Company, a manufacturer of furniture sets, is considering to purchase the seat cushions…
A: Make-or-buy decisions should be based on the relevant cost of each option. Any costs that are…
Q: Farrow Co. expects to sell 200,000 units of its product in the next period with the following…
A: Incremental cost is over and above current cost. Overhead cost for additional units $200000*16℅ =…
Q: Green Company produces 1,000 parts per year, which are used in the assembly of one of its products.…
A: A make-or-buy choice is a demonstration of picking between assembling an item in-house or buying it…
Q: Salisbury Corporation has been producing and selling 30,000 caps a year. The company has the…
A: Minimum Acceptable Price :— It is variable cost per unit plus contribution loss per unit.…
Q: Green Company produces 1,000 parts per year, which are used in the assembly of one of its products.…
A: Make or buy is one of an important and crucial decision need to taken by manager, in this decision…
Q: Lindon Company is the exclusive distributor for an automotive product that sells for $40 per unit…
A: Old variable expense per unit = $40 x 70% = $28
Q: Sage Company is operating at 90% of capacity and is currently purchasing a part used in its…
A: TOTAL UNITS : = 30,000 UNITS VARIABLE COST : = $11 PER UNIT PURCHASE COST : = $15 PER UNIT…
Q: Orion Inc., is a newly organized manufacturing business that plans to manufacture and sell 30,000…
A: Answer 1) Calculation of Selling price to earn Target Income Let the selling price to earn target…
Q: Perry, Inc. manufactures metal stampings for automobiles: stick shifts and trim kits. Fixed costs…
A: Contribution margin per unit = Sales per unit - Variable cost per unit Break-even point in…
Q: Tom Industries has a plant capacity of 70,000 units per month. The company is currently operating…
A: Contribution margin=Sales-Variable costOperating income=Contribution margin-Fixed costs
Q: Saturn Company produces 1,000 parts per year, which are used in the assembly of one of its products.…
A: PLEASE GIVE A LIKE YOUR RESPONSE MATTERS THE CORRECT ANSWER IS OPTION (C) $2,000 decrease
Q: Jansen Crafters has the capacity to produce 50,000 oak shelves per year and is currently selling…
A: Absolute advantage refers to an individual, company, region, or country's ability to create more of…
Q: Sandusky Inc. has the following costs when producing 100,000 units: Variable costs $600,000 Fixed…
A: The cost can be classified into two categories i.e fixed cost and variable cost. The FIxed cost…
Q: Piper Corp. is operating at 70% of capacity and is currently purchasing a part used in its…
A: Answer is Option c) $30,000 cost increase .
Q: Schweser Satellites Inc. produces satellite earth stations that sell for $105,000 each. The firm's…
A: Answer with ll calculations are as follows
Q: Crane, Inc., sells two types of water pitchers, plastic and glass. Plastic pitchers cost the company…
A: The cost volume profit analysis can be defined as the method of analyzing the effect of variable…
Q: Kent Co. manufactures a product that sells for $50.00 and has variable costs of $24.00 per unit.…
A: Contribution margin = Sales - Variable cost
Q: Newton Company currently produces and sells 6,000 units of a product that has a contribution margin…
A: In the given question, first desired contribution margin per unit to earn target income will be…
Q: Sparrow Co. is currently operating at 80% of capacity and is currently purchasing a part used in its…
A: Differential cost means diff. between the cost of two alternative decisions i.e. either the firm has…
Q: Dull Corporation produces 8,000 parts each year, which are used in the production of one of its…
A: Give, Purchase price = $28 Fixed cost if purchased from outside = $20 - ($20*1/4) Fixed cost if…
Q: Goldberg Company currently manufactures 52,000 units per year of a key component for its…
A: Introduction Incremental cost: Incremental cost is the additional cost incurred by the company if it…
Q: The Southern Division of Barstol Company makes and sells a single product, which is a part used in…
A: Contribution Margin per unit from outstand customer = selling price per unit -Variable cost per…
Q: Jansen Crafters has the capacity to produce 50,000 oak shelves per year and is currently selling…
A: Incremental Revenue = Special order no. of units x Special order sales price per unit = 1,200 x $26…
Q: eptune Company has developed a small inflatable toy that it is anxious to introduce to its…
A: Break-even Point is a point where revenue is able to cover all fixed as well as variable expenses of…
Q: Compute the contribution margin per unit if the machine is purchased.
A: Contribution Margin = Sale Price - Variable Cost Sale Price = $57 per unit Variable Cost = $34 per…
Q: t it estimates will sell for $95 per unit. Annual demand is estimated to be 98,000 units. Sonora…
A: Target costing is a way of calculating a product's life-cycle cost, which should be sufficient to…
Q: Nytre Limited sells executive office chairs for a price of $195 each. The contribution margin ratio…
A: Price of Chair = $195 Contribution Margin Ratio = 60% Fixed cost = $80,000 Target profit = $85,000…
Q: Neptune Company has developed a small inflatable toy that it is anxious to introduce to its…
A: Break-even point = Fixed cost / Contribution per unit (Sale price - Unit Variable cost) Weighted…
Q: Valero Company had sales in 2016 of $1,800,000 on 60,000 units. Variable costs totaled $720,000, and…
A: CVP income statement means a statement where expenses are divided in two parts i.e. fixed cost and…
Q: Gilberto Company currently manufactures 66,000 units per year of one of its crucial parts. Variable…
A: Incremental cost: Incremental cost is the analysis of the costs in different avenues, which could be…
Q: The Metal Shop produces 1.8 million metal fasteners a year for industrial use. At this level of…
A: Calculate the variable cost as follows: Variable cost = Total cost - Fixed cost Variable cost =…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Markson and Sons leases a copy machine with terms that include a fixed fee each month plus acharge for each copy made. Markson made 9,000 copies and paid a total of $480 in January. In April, they paid $320 for 5,000 copies. What is the variable cost per copy if Markson uses the high-low method to analyze costs?Roper Furniture manufactures office furniture and tracks cost data across their process. The following are some of the costs that they incur. Classify these costs as fixed or variable costs, and as product costs or period costs. Wood used to produce desks ($125,00 per desk) Production labor used to produce desks ($15 per hour) Production supervisor salary ($45,000 per year) Depreciation on factory equipment ($60,000 per year) Selling and administrative expenses ($45,000 per year) Rent on corporate office ($44,000 per year) Nails, glue, and other materials required to produce desks (varies per desk) Utilities expenses for production facility Sales staff commission (5% of gross sales)Price Company sells its product for $100 per unit. The company's accountant provided the following cost information. What is the company's break-even ?point Mamufacturing costs: Selling costs: Administrative costs: $35,000+35% of sales $15,000 + 15% of sales $20,000 + 10% of sales $1,075 units O None O $2,500 units $1,365 units C $1,750 units O ОООО 道
- San Clemente Inc. incurs the following costs to produce 10,000 units of a subcomponent: Direct materials $8,400 Direct labor 11,250 Variable overhead 12,600 Fixed overhead 16,200 An outside supplier has offered to sell San Clemente the subcomponent for $2.85 a unit. If San Clemente accepts the offer, by how much will net income increase (decrease)?Kingston Company sells its product for $300 per unit. The company's accountant provided the following cost information: Manufacturing costs Selling costs Administrative costs $20,300 + 46% of sales $13,100+ 23% of sales $25,400+ 8% of sales. What is Kingston Company's contribution margin ratio?Use the information below to answer the following question(s). Franscioso Company sells several products. Information of average revenue and costs is as follows: Selling price per unit $28.50 Variable costs per unit: Direct material $5.25 Direct manufacturing labour $1.15 Manufacturing overhead $0.25 Selling costs $1.85 Annual fixed costs $110,000 The Franscioso Company contribution margin ratio is O A. 0.702:1. O B. 1.425:1. O C. 0.298:1. O D. 1.102:1. O E. 0.637:1.
- San Clemente Inc. incurs the following costs to produce 10,000 units of a subcomponent: Direct materials $8,400 Direct labor 11,250 Variable overhead 12,600 Fixed overhead 16,200 An outside supplier has offered to sell San Clemente the subcomponent for $2.85 a unit. If San Clemente accepts the offer, by how much will net income increase (decrease)? ($8,850) decrease ($2,850) decrease O $19,950 increase $3,750 increaseDolCor, Inc. manufactures and sells two products: Debit and Credit. The following data were extracted from last month's accounting records: Debit Credit Sales Revenue $190,000 $180,000 Product Costs $144,000 $132,000 Period Costs $28,000 $26,400 Debit's product costs consists of $29,000 of traceable fixed costs. The remainder of its product costs are variable costs. Debit's period costs consist of sales commission that equal 10% of its sales revenue. The remainder of its period costs are allocated common fixed costs. Credit's contribution margin percentage is 45%. Of its fixed costs, $6,700 are traceable. The remainder of its fixed costs are allocated common fixed costs. Which of the following statements is incorrect? O A. If Debit was expected to generate a segment margin of $30,000, it fell short of management's expectations by $3,000. B. Debit's total traceable costs equal $163,000. C. Credit's performance should be judged on a segment margin of $74,300. D. The total common fixed…Northenscold Company sells several products. Information of average revenue and costs are as follows: Selling price per unit $20.00 Variable costs per unit: Direct materials $4.00 Direct manufacturing labor $2.00 ABC cost per unit $0.50 Fixed MOH $0.40 Variable MOH $0.30 Selling costs $2.00 Annual fixed costs $96,000 Calculate the number of units Northenscold's must sell to yield a profit of $144,000. (round to nearest whole unit).
- John Company produces hats and sells them for $100 each. His cost to produce the hats are: DM 20 per unit DL 30 per unit VMOH 10 per unit FMOH 40,000 Selling expenses are $5 per unit and are all variable. Administrative expenses of 25,000 are all fixed. John produced 5,000 hats; sold 4,000; and had no beginning inventory. Complete the income statement and calculation of net income under absorption costing. Absorption Costing Income Statement Sales Cost of Goods Sold: 80,000 Direct labor Fixed manufacturing overhead Total Cost of Goods Sold Gross profit 128,000 Selling expenses 25,000 45,000 Net incomeBrother Company sells its products for $66 each. The current production level is 25,000 units. Only 20,000 units are expected to be sold. Units manufacturing costs are: Direct materials Direct manufacturing labor Variable manufacturing costs Total fixed manufacturing costs Marketing expenses $ 12.00 18.00 9.00 180,000.00 $6.00 per unit plus $60,000 per year Required: 1. Compute the cost of goods sold under both absorption and variable costing.Royal Lawncare Company produces and sells two packaged products—Weedban and Greengrow. Revenue and cost information relating to the products follow: Product Weedban GreengrowSelling price per unit $ 9.00 $ 33.00Variable expenses per unit $ 2.50 $ 12.00Traceable fixed expenses per year $ 136,000 $ 41,000 Common fixed expenses in the company total $110,000 annually. Last year the company produced and sold 37,000 units of Weedban and 19,500 units of Greengrow. Required: Prepare a contribution format income statement segmented by product lines.