Skip to question [The following information applies to the questions displayed below.] Henna Company produces and sells two products, Carvings and Mementos. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 52,000 units of each product. Income statements for each product follow. Carvings Mementos $ 842,400 $ 842,400 Sales Variable costs 673,920 Contribution margin 168,480 Fixed costs 26,480 Income 168,480 673,920 531,920 $ 142,000 $ 142,000 2. Assume that the company expects sales of each product to decline to 35,000 units next year with no change in unit selling price. Prepare a contribution margin income statement for the next year (as shown above with columns for each of the two products). Note: Round "per unit" answers to 2 decimal

Skip to question [The following information applies to the questions displayed below.] Henna Company produces and sells two products, Carvings and Mementos. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 52,000 units of each product. Income statements for each product follow. Carvings Mementos $ 842,400 $ 842,400 Sales Variable costs 673,920 Contribution margin 168,480 Fixed costs 26,480 Income 168,480 673,920 531,920 $ 142,000 $ 142,000 2. Assume that the company expects sales of each product to decline to 35,000 units next year with no change in unit selling price. Prepare a contribution margin income statement for the next year (as shown above with columns for each of the two products). Note: Round "per unit" answers to 2 decimal

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter2: Basic Managerial Accounting Concepts

Section: Chapter Questions

Problem 15MCQ: Use the following information for Multiple- Choice Questions 2-13 through 2-18: Last year, Barnard...

See similar textbooks

Similar questions

Low-Tek Manufacturing Incorporated makes two types of industrial component parts - the B300 and the T500. The Income Statement for the most recent period is shown below: Low-Tek Manufacturing Incorporated Income Statement Sales Cost of goods sold Gross profit P2,100,000 1,600,000 500,000 550,000 Selling and administrative expenses Net operating loss P(50,000) Low-Tek produced and sold 70,000 units of B300 at a price of P20 per unit and 17,500 units of T500 at a price of P40 per unit. The company's traditional cost system allocates manufacturing overhead to products using a plantwide overhead rate and direct labor cost as the allocation based. Additional information relating to the company's two product lines is shown below: T500 TOTAL B300 P436,300 P251,700 P688,000 Direct materials Direct labor P200,000 P104,000 304,000 Manufacturing overhead Cost of goods sold 608,000 P1,600,000 The company has created an activity -based costing system to evaluate the profitability of its products.…
Metlock Company is a multiproduct firm. Presented below is information concerning one of its products, the Hawkeye. Date Transaction Quantity Price/Cost 1/1 Beginning inventory 2,000 $15 2/4 Purchase 3,000 23 2/20 Sale 3,500 38 4/2 Purchase 4,000 29 11/4 Sale 3,200 42 Compute cost of goods sold, assuming Metlock uses: (Round average cost per unit to 4 decimal places, e.g. 2.7631 and final answers to 0 decimal places, e.g. 6,548.) Cost of goods sold (a) Periodic system, FIFO cost flow $ (b) Perpetual system, FIFO cost flow $ (c) Periodic system, LIFO cost flow $ (d) Perpetual system, LIFO cost flow $ (e) Periodic system, weighted-average cost flow $ (f) Perpetual system, moving-average cost flow $
Vati-Vati CC produces and sells only one product. The following data is available: Net sales N$800 000 Gross profit N$450 000 Determine the amount of cost of sales. Answer:
Pedaci Corporation produces and sells a single product. Data concerning that product appear below: Assume the company's monthly target profit is $15,000. The unit sales to attain that target profit is closest to: 3,212B. 5,265C. 8,235D. 5,571 Assume the company's monthly target profit is $17,000. The dollar sales to attain that target profit is closest to: $387,392B. $635,069C. $671,925D. $993,313
United Company blends and sells two products X&Y. each with different sales strategies, distribution channels, and product offerings. United is now considering the sale of a bundled product consisting of X&Y. For the most recent year, United reported retail price of X product $192, of Y product $448 and of (X+Y) $520. Using stand-alone revenue allocation method, the revenue allocated to Y product is: a. $192. b. $364. c. $448. d. $156.
Pinta Company produces and sells two products, Ballpen and Sign Pen. Presented below are the financial figures in the production and sale of Pinta Company Sales in units (box) Ballpen Sign Pen Total 3,000 2,000 5,000 Sales P350,000.00 P400,000.00 P750,000.00 VC 100,000.00 250,000.00 350,000.00 CM 250,000.00 150,000.00 400,000.00 FX 120,000.00 NI 280,000.00 Required: How many units of Ballpen should be sold next month to break even? How many units of Ph Sign Pen should be sold to earn a profit of P300,000.00? How many units of Ph Sign Pen should be sold to earn a profit of P150,000 net of 35% tax?
Vati-Vati CC produces and sells only one product. The following data is available: Cost of sales N$550 000 Gross profit N$350 000 Determine the amount of revenue/sales. Answer:
AJXKXJ923 Corp. is a merchandiser with a single product. Corp.'s accountants have provided the following cost data for two levels of sales volume. Sales units Cost of goods sold (ID#77379) Selling and Administrative costs Selling price per unit 10,000 $470,000 20,000 $800,000 $500,000 $150 $780,000 $150 Q)What's the best estimate of AJXKXJ923's net operating income if 15,920 units are sold? A.) $ Next > 14.of 25
The Mansfield Company manufactures and sells two lines of fishing rods. During the most recent accounting period, the Pro line and the Novice line sold 16,600 and 3,600 units, respectively. The company's most recent financial statements are shown below: Sales Less cost of goods sold: Unit-level production cost Depreciation, production equipment Gross margin Less operating expenses: Unit-level selling and administrative costs Corporate-level facility expenses (fixed) Net income (loss) Based on this information, the company should: Multiple Choice It is impossible to determine with the given information. Pro $996,000 664,000 149,000 $183,000 Keep the Novice line because it contributes $99,000 to total profitability. Eliminate the Novice line because it is operating at a loss. 44,000 39,840 $99,160 Keep the Novice line because it contributes $72,000 to total profitability. Novice $432,000 243,000 90,000 $99,000 117,000 39,840 $(57,840)
Patterson Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. PATTERSON COMPANY Income Statements for the Year 2014 Segment Sales A В C $162,000 $242,000 $263,000 (84,000) (30,000) (80,000) (31,000) Cost of goods sold Sales commissions (128,000) (18,000) Contribution margin General fixed oper. exp. (allocation of president's salary) Advertising expense (specific to individual divisions) 16,000 128,000 152,000 (35,000) (39,000) (33,000) (3,000) (15,000) (26,000) $ 78,000 119,000 Net income Required: a. Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Effect on income b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A PATTERSON COMPANY Comparative Income Statements for the Year 2014 Eliminate Seg. A Keep Seg. A Decision Sales Cost of…
Splish Company is a multiproduct firm. Presented below is information concerning one of its products, the Hawkeye. Date 1/1 2/4 2/20 4/2 11/4 (a) Transaction Beginning inventory Purchase Sale Purchase Sale Quantity Price/Cost Average-cost per unit $ 3,400 4,400 4,900 5,400 4,600 $19 28 47 36 51 Calculate average-cost per unit. (Round answer to 4 decimal places, e.g. 2.7613.)
Patterson Company operates three segments. Income statements for the segments imply that profitability could be improved if Segment A were eliminated. PATTERSON COMPANY Income Statements for the Year 2014 Segment Sales А В С $169,000 $243,000 $258,000 (80,000) (31,000) (121,000) (17,000) Cost of goods sold Sales commissions (88,000) (30,000) Contribution margin General fixed oper. exp. (allocation of president's salary) Advertising expense (specific to individual divisions) 132,000 31,000 140,000 (34,000) (48,000) (32,000) (6,000) (11,000) (9,000) $73,000 $108,000 Net income Required: a. Prepare a schedule of relevant sales and costs for Segment A. Relevant Rev. and Cost items for Segment A Effect on income b. Prepare comparative income statements for the company as a whole under two alternatives: (1) the retention of Segment A and (2) the elimination of Segment A. PATTERSON COMPANY Comparative Income Statements for the Year 2014 Eliminate Seg. A Keep Seg.A Decision Sales Cost of goods…