Required information. [The following information applies to the questions displayed below] Burchard Company sold 26,000 units of its only product for $19,80 per unit this year. Manufacturing and selling the product required $282,000 of fixed costs. Its per unit variable costs follow. Direct materials Direct labor Variable overhead costs Variable selling and administrative costs For the next year, management will use a new material, which will reduce direct materials costs to $.93 per unit and reduce direct labor costs to $1.47 per unit. Sales, total fixed costs, variable overhead costs per unit, and variable selling and administrative costs per unit will not change Management is also considering raising its selling price to $25.74 per unit, which would decrease unit sales volume to 22,100 units. 2. Prepare a contribution margin income statement for next year with two columns showing the expected results of (a) using the new material and (b) using the new material and increasing the selling price. BURCHARD COMPANY Contribution Margin Income Statement Number of units: With new material $ 3.10 2.10 0.31 0.11 26,000 With new material and price increase 22,100
Required information. [The following information applies to the questions displayed below] Burchard Company sold 26,000 units of its only product for $19,80 per unit this year. Manufacturing and selling the product required $282,000 of fixed costs. Its per unit variable costs follow. Direct materials Direct labor Variable overhead costs Variable selling and administrative costs For the next year, management will use a new material, which will reduce direct materials costs to $.93 per unit and reduce direct labor costs to $1.47 per unit. Sales, total fixed costs, variable overhead costs per unit, and variable selling and administrative costs per unit will not change Management is also considering raising its selling price to $25.74 per unit, which would decrease unit sales volume to 22,100 units. 2. Prepare a contribution margin income statement for next year with two columns showing the expected results of (a) using the new material and (b) using the new material and increasing the selling price. BURCHARD COMPANY Contribution Margin Income Statement Number of units: With new material $ 3.10 2.10 0.31 0.11 26,000 With new material and price increase 22,100
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter13: The Balanced Scorecard: Strategic-based Control
Section: Chapter Questions
Problem 8E: Hatch Manufacturing produces multiple machine parts. The theoretical cycle time for one of its...
Related questions
Question
Please do not give solution in image format thanku
![Required information
[The following information applies to the questions displayed below]
Burchard Company sold 26,000 units of its only product for $19,80 per unit this year. Manufacturing and selling the
product required $282,000 of fixed costs. Its per unit variable costs follow.
Direct materials
Direct labor
Variable overhead costs
Variable selling and administrative costs
For the next year, management will use a new material, which will reduce direct materials costs to $.93 per unit and
reduce direct labor costs to $1.47 per unit. Sales, total fixed costs, variable overhead costs per unit, and variable selling
and administrative costs per unit will not change Management is also considering raising its selling price to $25.74 per
unit, which would decrease unit sales volume to 22,100 units.
2. Prepare a contribution margin income statement for next year with two columns showing the expected results of (a) using the new
material and (b) using the new material and increasing the selling price.
BURCHARD COMPANY
Contribution Margin Income Statement
Number of units:
With new material
$ 3.10
2.10
0.31
0.11
26,000
With new
material and
price increase
22,100](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3df61de3-ee09-41ef-8873-9f950e8ed1d8%2Ffc484ef4-2114-455b-865f-d5bc3075cab1%2Fyw79gmb_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below]
Burchard Company sold 26,000 units of its only product for $19,80 per unit this year. Manufacturing and selling the
product required $282,000 of fixed costs. Its per unit variable costs follow.
Direct materials
Direct labor
Variable overhead costs
Variable selling and administrative costs
For the next year, management will use a new material, which will reduce direct materials costs to $.93 per unit and
reduce direct labor costs to $1.47 per unit. Sales, total fixed costs, variable overhead costs per unit, and variable selling
and administrative costs per unit will not change Management is also considering raising its selling price to $25.74 per
unit, which would decrease unit sales volume to 22,100 units.
2. Prepare a contribution margin income statement for next year with two columns showing the expected results of (a) using the new
material and (b) using the new material and increasing the selling price.
BURCHARD COMPANY
Contribution Margin Income Statement
Number of units:
With new material
$ 3.10
2.10
0.31
0.11
26,000
With new
material and
price increase
22,100
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Principles of Cost Accounting
Accounting
ISBN:
9781305087408
Author:
Edward J. Vanderbeck, Maria R. Mitchell
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning