Please do not give solution in image format thanku Parker Pottery produces a line of vases and a line of ceramic figurines. Each line uses the same equipment and labor;hence, there are no traceable fixed costs. Common fixed cost equals $50,000. Parker's accountant has begun to assessthe profitability of the two lines and has gathered the following data for last year:PRICEVARIABLE COSTCONTRIBUTION MARGINNUMBER OF UNITSIf required, round your final answers to nearest whole value.VASESFIGURINES40703042102810005001. Compute the number of vases and the number of figurines that must be sold for the company to break even.BREAKEVEN VASES, BREAKEVEN FIGURINES2. Parker Pottery is considering upgrading its factory to improve the quality of its products. The upgrade will add $5,260per year to total fixed cost. If the upgrade is successful, the projected sales of vases will be 1,500, and figurine sales willincrease to 1,000 units. What is the new break-even point in units for each of the products?

Lets understand the basics.The contribution margin is calculated as the difference between the sales…

Answered: PRICE VARIABLE COST CONTRIBUTION MARGIN…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Parker Pottery produces a line of vases and a line of ceramic figurines. Each line uses the sameequipment and labor; hence, there are no traceable fixed costs. Common fixed cost equals$30,000. Parker’s accountant has begun to assess the profitability of the two lines and has gathered the following data for last year: Required:1. Compute the number of vases and the number of figurines that must be sold for thecompany to break even.2. Parker Pottery is considering upgrading its factory to improve the quality of its products.The upgrade will add $5,260 per year to total fixed cost. If the upgrade is successful, theprojected sales of vases will be 1,500, and figurine sales will increase to 1,000 units. Whatis the new break-even point in units for each of the products?
Parker Pottery produces a line of vases and a line of ceramic figurines. Each line uses the same equipment and labor; hence, there are no traceable fixed costs. Common fixed cost equals $40,000. Parker's accountant has begun to assess the profitability of the two lines and has gathered the following data for last year: VasesFigurinesPrice$40$70Variable cost3042Contribution margin$10$28Number of units1,000500 Required: If required, round your final answers to nearest whole value. 1. Compute the number of vases and the number of figurines that must be sold for the company to break even. Break-even vasesfill in the blank 1 unitsBreak-even figurinesfill in the blank 2 units 2. Parker Pottery is considering upgrading its factory to improve the quality of its products. The upgrade will add $5,260 per year to total fixed cost. If the upgrade is successful, the projected sales of vases will be 1,500, and figurine sales will increase to 1,000 units. What is the new break-even point in…
Parker Pottery produces a line of vases and a line of ceramic figurines. Each line uses the same equipment and labour; hence, there is no traceable fixed costs. Common fixed costs equal $17 400. Parker’s accountant has begun to assess the profitability of the two lines and has gathered the following data for last year: Price Variable costs Number of units The tax rate is 28%. Required $40 $70 $30 $42 1 200 400 a. Calculate the weighted average contribution margin. b. Compute the number of vases and the number of figurines that must be sold for the company to break-even. How much revenue would be received for each product?
Parker Pottery produces a line of vases and a line of ceramic figurines. Each line uses the same equipment and labor; hence, there are no traceable fixed costs. Common fixed cost equals $38, 400. Parker's accountant has begun to assess the profitability of the two lines and has gathered the following data for last year: Vases Figurines Price $40 $70 Variable cost 30 42 Contribution margin $10 $28 Number of units 1,000 500 Required: If required, round your final answers to nearest whole value. 1. Compute the number of vases and the number of figurines that must be sold for the company to break even. Break - even vases fill in the blank 1 units Break - even figurines fill in the blank 2 units 2. Parker Pottery is considering upgrading its factory to improve the quality of its products. The upgrade will add $5, 280 per year to total fixed cost. If the upgrade is successful, the projected sales of vases will be 2,000, and figurine sales will increase to 1,000 units. What is the new break -…
A new product is being designed by an engineering team at Golem Security. Several managers and employees from the cost accounting department and the marketing department are also on the team to evaluate the product and determine the cost using a target costing methodology. An analysis of similar products on the market suggests a price of $132.00 per unit. The company requires a profit of 0.20 of selling price. How much is the target cost per unit? Round to two decimal places.
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A company is analyzing a make-versus-purchase situation for a component used in several products, and the engineering department has developed these data:Option A: Purchase 10,000 items per year at a fixed price of $8.50 per item. The cost of placing the order is negligible according to the present cost accounting procedure. Option B: Manufacture 10,000 items per year, using available capacity in the factory. Cost estimates are direct materials = $5.00 per item and direct labor = $1.50 per item. Manufacturing overhead is $3.00 per item. Based on these data, should the item be purchased or manufactured?
Best Windows is a small company that installs windows. Its cost structure is as follows: Selling price from each window installation Variable cost of each window installation Annual fixed costs $ $ $ 160,000 Use (a) the equation method and (b) the contribution method to calculate operating income if Best installs 4,000 windows. Use (a) the Equation method to calculate operating income if Best installs 4,000 windows. Begin by determining the formula to calculate the operating income using the equation method. Then, calculate the operating income. (Abbreviation used: FC = Fixed costs, SP = Selling price, VCU = Variable cost per unit, Q = Quantity of units sold.) X X )-( )-( X X 700 600 X = Operating income = Next, use (b) the contribution method to calculate operating income if Best installs 4,000 windows. Begin by determining the formula to calculate the operating income using the contribution method. Then, calculate the operating income. = Operating income
Bernard Windows is a small company that installs windows. Its cost structure is as follows: Selling price from each window installation $500 Variable cost of each window installation $400 Annual fixed costs $150,000 Use (a) the Equation method and (b) the contribution method to calculate operating income if Bernard installs 2,000 windows. Use (a) the Equation method to calculate operating income if Bernard installs 2,000 windows. Begin by determining the formula to calculate the operating income using the equation method. Then, calculate the operating income. (Abbreviation used: FC = Fixed costs, SP = Selling price, VCU = Variable cost per unit, Q = Quantity of units sold.) ( × ) - ( × ) - = Operating income ( × ) - ( × ) - =
Windows is a small company that installs windows. Its cost structure is as follows: LOADING... (Click the icon to view the cost structure.) Traylor Windows' breakeven revenues is $1,870,000 and breakeven units is 3,400. Calculate the margin of safety in units and dollars and the margin of safety percentage if Traylor Windows expects to sell 3,600 windows in the year. Begin with calculating the margin of safety in dollars. Determine the formula to calculate the margin of safety in dollars. Then, enter the amounts and calculate the margin of safety in dollars. Budgeted revenue - Breakeven revenue = Margin of safety in dollars - = Next, determine the formula, enter the amounts, and calculate the margin of safety in units. Budgeted units - Breakeven units = Margin of safety in units - = Finally, calculate the margin of safety percentage if…
A company is analyzing a make-versus-purchase situation for a component used in several products and the engineering department has developed these data: Option A: Purchase 10,000 items per year at a fixed cost of Php 340 per item. The cost of placing the order is negligible according to the present cost accounting procedure. Option B: Manufacture 10,000 items per year, using available capacity in the factory. Cost estimates are direct materials= Php 200 per item and direct labor = Php 60 per item. Manufacturing overhead is allocated at 200% of direct labor. Based on these data, should the item be purchased or manufacture?
Rundle Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,300 containers follows. Unit-level materials. Unit-level labor Unit-level overhead Product-level costs* Allocated facility-level costs One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Rundle for $2.60 each. Required a. Calculate the total relevant cost. Should Rundle continue to make the containers? b. Rundle could lease the space it currently uses in the manufacturing process. If leasing would produce $11,600 per month, calculate the total avoidable costs. Should Rundle continue to make the containers? Answer is complete but not entirely correct. $ a. Total relevant cost a. Should Rundle continue to make the containers? b. Total avoidable cost b. Should Rundle continue to make the containers? 190.650,000 Yes $24,180,000 $ 5,200 6,100 4,000 7,800…

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