The following data are for Greasy Gary's Grubhouse: WestEastSales volume (units): Hub Cap14,0009,000 Gas Can6,50018,000Sales price per unit: Hub Cap$36$28 Gas Can$22$31The variable cost of goods sold per unit Hub Cap$19$17 Gas Can$9$14Variable selling and administrative per unit Hub Cap$ 5$ 4 Gas Can$ 3 $2(a) Complete a contribution margin by sales territory and by-product (b) Analyze the statements and comment on what can help the company in terms of profitability, product placement, and territory. List 3 pros and cons to each product and territory.

There can be several products in one company. So it is neccsary to identify profits in each product…

Answered: Sales price per unit: Hub Cap…

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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The following data are for Greasy Gary's Grubhouse:

	West	East
Sales volume (units):
Hub Cap	14,000	9,000
Gas Can	6,500	18,000
Sales price per unit:
Hub Cap	$36	$28
Gas Can	$22	$31
The variable cost of goods sold per unit
Hub Cap	$19	$17
Gas Can	$9	$14
Variable selling and administrative per unit
Hub Cap	$ 5	$ 4
Gas Can	$ 3	$2

(a) Complete a contribution margin by sales territory and by-product (b) Analyze the statements and comment on what can help the company in terms of profitability, product placement, and territory. List 3 pros and cons to each product and territory.

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