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- Fresh to Go makes a variety of delicious and healthy smoothies. It's most popular drinks contain an imported pomegranate julce and Fresh to Go can only import 64,000 ounces of the juice per month. The juice is used to make 3 different types of smoathies: Pure Pom Cherry Pom Pom Punch Selling price Variable cost Contribution margin $13.00 $9.00 $4.00 $a.00 $5.00 $3.00 $6.00 $3.50 $2.50 Ounces of pomegranate juice used 4 1 Assume there is unlimited demand for the smoothles and Fresh to Go wants to maximize sales of its smoothie with the highest contribution margin per ounce. Normally, the company pays S0.30 per ounce for pomegranate juice up to 64,000 ounces. If the company can obtain additional ounces above the 64,000, what is the maximum price it would be willing to pay per ounce? $1.10 $4.30 $2.80 $0.00Island Novelties, Inc., of Palau makes two products—Hawaiian Fantasy and Tahitian Joy. Each product's selling price, variable expense per unit and annual sales volume are as follows: Hawaiian Fantasy Tahitian Joy Selling price per unit $ 15 $ 100 Variable expense per unit $ 9 $ 20 Number of units sold annually 20,000 5,000 Fixed expenses total $475,800 per year. Required: 1. Assuming the sales mix given above, do the following: a. Prepare a contribution format income statement showing both dollar and percent columns for each product and for the company as a whole. b. Compute the company's break-even point in dollar sales. Also, compute its margin of safety in dollars and its margin of safety percentage. 2. The company has developed a new product called Samoan Delight that sells for $45 each and that has variable expenses of $36 per unit. If the company can sell 10,000 units of Samoan Delight without incurring any additional fixed expenses: a.…Barkov Bakeries produces deluxe muffins in its manufacturing facility in Florida. Data concerning these products appear below. Cornbread Blueberry Plain Normal annual sales volume 200,000 300,000 500,000 Unit selling price $ 2.50 $ 3.00 $ 2.00 Variable cost per unit $ 1.80 $ 2.00 $ 1.40 Total fixed expenses for the entire company are $2,500,000 per year. All three products are sold in highly competitive markets, so the company is unable to raise its prices without losing unacceptable numbers of customers. The company has no work in process or finished goods inventories due to an extremely effective just-in-time manufacturing system.…
- Robinsons Company makes three products, all of which require the use of a special machine. Only 200 hours of machine time are available per month. Data for the three products are as a follow. Winston can sell as much of any product as it can make. Product 1 Product 2 Product 3 Selling Price P12 P16 P21 Variable Cost 7 8 10 Contribution Margin P5 P8 P11 Machine time required in min. 6 10 15 Required: Which product should be produced to maximize profits? Given the capacity constraint, determine which product the company should make and what total monthly contribution margin the company would earn by making only that product. How much would the selling price of the next most profitable (per machine hour) product have to rise to be as profitable as the product you selected in item 2?Sheridan's Fish House can produce and sell only one of the following two products: Fried catfish Fried grouper Fryer Hours Required O $12700 O $38100 O $50800 O $63500 3 4 Contribution Margin Per Unit $15 $16 The company has fryer capacity of 12700 hours. How much will the contribution margin be if it produces only the most profitable product?Lolitas Factpry produced 3 kinds of bubbe soap products with the following cost information: Esperma Scented Colored Total Sales price/unit 15 20 25 Contribution margin/unit 5 15 12 Fixed cost 50,000.00 Required: 3.1 How many each products to produce to Break even? 3.2 Breakeven in peso? 3.3 Due to competition, he decided to produce one type of product, which product shall produce and why?
- Containers Galore sells two products with information as follows: Small containers: Price per unit - P12 Variable cost per unit - P10 Large containers: Price per unit - P20 Variable cost per unit - P12 Products are made by machines. 4 small containers can be made with one machine hour and 2 large containers can be made with one machine hour. The company has a maximum of 3,000 machine hours available per month. Assume there are no constraints on sales of either product, and the company could choose any product mix they wish. What is the maximum amount of contribution margin that the company could earn in a month?Island Novelties, Incorporated, of Palau makes two products-Hawaiian Fantasy and Tahitian Joy. Each product's selling price, variable expense per unit and annual sales volume are as follows: Hawaiian Fantasy Tahitian Joy Selling price per unit $ 12 $ 120 Variable expense per unit $9 $ 48 Number of units sold annually 36,000 5,400 Fixed expenses total $ 437,000 per year. Required: 1. Assuming the sales mix given above, do the following: a. Prepare a contribution format income statement showing both dollar and percent columns for each product and for the company as a whole. b. Compute the company's break - even point in dollar sales. Also, compute its margin of safety in dollars and its margin of safety percentage. 2. The company has developed a new product called Samoan Delight that sells for $45 each and that has variable expenses of $27 per unit. If the company can sell 12,000 units of Samoan Delight without incurring any additional fixed expenses: a. Prepare a revised contribution…Your Company manufactures and sells three products that all use a liquid compound as an ingredient. The high demand for all three of these products exceeds the supply of liquid compound that is available from suppliers and only 6,025 ounces are available. Information related to the three products is below: Products A B Demand in units 1,500 1,000 425 Selling price per unit Variable costs per unit $120 $100 $200 $84 $70 $130 Ounces per unit 3 2 5 What is the maximum annual net operating income that Your Company can make each year from these three products? Do not use $ in your answer.
- Question 2: Zeroll Ice Cream company produces and sells premium ice cream cones in Coles supermarkets. The following table shows selling price and cost information of ice cream cones: Price per cone: $ 5.00 Variable cost per cone:Ingredients $1.35Direct labour $0.45Overhead $0.20Fixed cost per month $3,000Required: a. Calculate the breakeven point in units and in dollars. Click or tap here to enter text.b. The company’s general director has determined a target profit of $6,000 for next year. Given the price and cost information above, what are the required sales in units and in dollars for the company to achieve this target? Click or tap here to enter text.c. Calculate Zeroll’s new break-even point (in units and in dollars) for each of the following independent scenarios: Selling price decreases by $0.50 per cone. Click or tap here to enter text. Fixed costs decrease by $300 per month. Click or tap here to enter text. Variable costs increase by $0.50 per cone Click or tap here to…Division A makes a part that it sells to customers outside of the company. Data concerning this part appear below: Саpаcity 20,000 Demand 20,000 Selling price $65 VC per unit $35 Total FC $10,000 Division B would like to use the part manufactured by Division A in one of its products. Division B currently purchases a similar part made by an outside company for $38 per unit Division B requires 5,000 units of the part each period. If Division A sells to Division B rather than to outside customers, the variable cost be unit would be $1 lower. What should be the lowest acceptable transfer price from the perspective of Division A?4. Kareem Industry produces three types of products: X, Y and Z. There is unlimited demand for the products throughout Southern Ontario. The following information is provided: X Y Z Unit selling price $60 $40 $20 Unit contribution margin $30 $20 $10 Processing time required per unit 1.25 hours 0.8 hours 0.5 hours Processing time is limited to 180 hours per month. What product mix should Kareem choose in order to maximize overall profit? a)Produce 144 units of X b)Produce 360 units of Z c)Produce 225 units of Y d)Produce 85 units of X and 40 units of Y e)Produce 70 units of X, 70 units of Y and 70 units of Z
