llery Corporation makes two products, footb
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Gallery Corporation makes two products, footballs and baseballs. Additional information follows:
| Footballs | Baseballs | |||||
| Units | 2,000 | 2,500 | ||||
| Sales | $60,000 | $25,000 | ||||
| Variable costs | 24,000 | 13,750 | ||||
| Fixed costs | 10,000 | 5,250 | ||||
| Net income | $26,000 | $6,000 | ||||
| Yards of leather per unit | 1.25 | 0.30 | ||||
| Profit per unit | $13.00 | $2.40 | ||||
| Contribution margin per unit | $18.00 | $4.50 |
Assume that Gallery is able to order an additional 2,500 yards of leather and wishes to maximize its income. Of the additional units it produces, at least 500 of each product are necessary for sales.
How many units of each must be produced?
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- 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.AMA Corporation has two products, x and y. The profit contribution of x is P50 per unit and the profit contribution of y is P25 per unit. The company has three machine centers that are available for 20, 24, and 18 hours respectively. Product x needs 1 hour in machine center 1, 3 hours in machine center 2, and 3 hours in machine center 3. Product y needs 2, 2, and 1 hour in machine centers 1, 2, and 3 respectively. The company can sell all it can produce. Find the number of units of x and y to produce to maximize the profit contributionPolaris 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 variablecost 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 doorhandles 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 itsplant to produce only trim kits. If this is done, fixed costs will decrease by $35,000, and70,000 trim kits can be produced and sold. Is this a good idea? Explain
- 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?Ziggy Creations makes and sells a single product. Individual product details are as follows: Selling price $ 45 Direct materials $20 Direct labour $10 Fixed Costs $480 000 Estimated sales 36 000 units Production capacity 40 000 units a) Calculate the contribution margin per unit. b) Calculate the breakeven point in units. c) Calculate the expected profit from the estimated sales. d) If Ziggy’s required a profit of $90 000, what level of sales dollars would be required? e) Variable costs are to increase by $5 per unit. If Ziggy’s wants to maintain a profit of $90,000, what will be the required sales volume? Can Ziggy’s achieve this new estimated sales volume?please solve the sub-parts to be solved. thanks Ziggy Creations makes and sells a single product. Individual product details are as follows: Selling price $ 45 Direct materials $20 Direct labour $10 Fixed Costs $480 000 Estimated sales 36 000 units Production capacity 40 000 units d) If Ziggy’s required a profit of $90 000, what level of sales dollars would be required? e) Variable costs are to increase by $5 per unit. If Ziggy’s wants to maintain a profit of $90,000, what will be the required sales volume? Can Ziggy’s achieve this new estimated sales volume?
- 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?International Printer Machines (IPM) builds three computer printer models: Alpha, Beta, and Gamma. Information for these three products is as follows: Alpha Beta Gamma total Selling price per unit $250 $400 $1500 variable price per unit $80 $200 $800 Expected Unit sales (annual) 12,000 6,000 2,000 20,000 Selling mix 50% 40% 10% 100% Total annual fixed costs are $5,000,000. Assume the sales mix remains the same at all levels of sales. Required: a) Calculate the weighted average unit contribution margin, assuming a constant sales mix. b) How many units of each printer must be sold to break even? c) i) Explain what is margin of safety ii) Calculate in sales units the margin of safety for IPM, assuming projected sales are 25,000 units? Show working1. Ray Tech Inc. manufactures Game Consoles. The selling price of each Game Consoles is$699, Raw materials per unit is $75, overhead per unit is $15, direct labor per unit is $12, andtotal fixed costs are $4,000,000. Calculate the following: a) Variable cost per unit b) contribution margin per unit c) breakeven point in units d) breakeven level of sales e) How many Game Consoles Ray Tech Inc. need to manufacture to achieve a desired income of$1,500,000.
- Rings Company has three product lines, A, B, and C. The following financial information is available: Item Product Line A Product Line B Product Line C Sales $ 66,000 $ 135,000 $ 30,000 Variable costs $ 39,600 $ 72,000 $ 18,750 Contribution margin $ 26,400 $ 63,000 $ 11,250 Fixed costs: Avoidable $ 6,100 $ 18,000 $ 8,400 Unavoidable $ 4,800 $ 13,500 $ 3,800 Pre-tax operating income $ 15,500 $ 31,500 $ (950) If Product Line C is discontinued and the manufacturing space formerly devoted to this line is rented for $6,000 per year, pre-tax operating income for the company will likely: Multiple Choice Be unchanged—the two effects cancel each other out. Increase by $1,950. Increase by $3,150. Increase by $5,850. Increase by some other amount.Tiago makes three models of camera lens. Its product mix and contribution margin per unit follow: Percentage of Unit sales Contribution Margin per unit Lens A 24 % $ 34 Lens B 43 26 Lens C 33 39 Required: 1. Determine the weighted-average contribution margin per unit. 2. Determine the number of units of each product that Tiago must sell to break even if fixed costs are $195,000. 3. Determine how many units of each product must be sold to generate a profit of $70,000.Diamond Company has three product lines, A, B, and C. The following financial information is available: Item Product Line A Product Line B Product Line C Sales $ 52,000 $ 100,000 $ 23,000 Variable costs $ 31,200 $ 53,000 $ 14,375 Contribution margin $ 20,800 $ 47,000 $ 8,625 Fixed costs: Avoidable $ 5,400 $ 14,500 $ 6,300 Unavoidable $ 4,100 $ 10,000 $ 3,100 Pre-tax operating income $ 11,300 $ 22,500 $ (-775 ) Diamond is thinking of dropping Product Line C because it is reporting an operating loss. Assuming the company drops Product Line C and does not replace it, pre-tax operating income for the firm will likely: Multiple Choice Be unchanged Increase by $2,025 Increase by $2,325 Decrease by $2,325 Decrease by $4,350