Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $293,000 for the company as a whole. In addition, the following information is available about the three products: Large Medium Small Unit selling price $179 $396 $191 Unit variable cost 141 324 168 Unit contribution margin $ 38 $72 $23 Autoclave hours per unit 4 6 2 Total process hours per unit 12 12 6 Budgeted units of production 4,900 4,900 4,900 a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production. Large Medium Small Total Units produced fill in the blank 1 fill in the blank 2 fill in the blank 3 Revenues $fill in the blank 4 $fill in the blank 5 $fill in the blank 6 $fill in the blank 7 Less: Variable costs fill in the blank 8 fill in the blank 9 fill in the blank 10 fill in the blank 11 Contribution margin $fill in the blank 12 $fill in the blank 13 $fill in the blank 14 $fill in the blank 15 Less: Fixed costs fill in the blank 16 Income from operations $fill in the blank 17 b. Prepare an analysis showing which product is the most profitable per bottleneck hour. Round the "Unit contribution margin per production bottleneck hour" amounts to the nearest cent. Large Medium Small Unit contribution margin $fill in the blank 18 $fill in the blank 19 $fill in the blank 20 Autoclave hours per unit fill in the blank 21 fill in the blank 22 fill in the blank 23 Unit contribution margin per production bottleneck hour $fill in the blank 24 $fill in the blank 25 $fill in the blank 26

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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Youngstown Glass Company manufactures three types of safety plate glass: large, medium, and small. All three products have high demand. Thus, Youngstown Glass is able to sell all the safety glass it can make. The production process includes an autoclave operation, which is a pressurized heat treatment. The autoclave is a production bottleneck. Total fixed costs are $293,000 for the company as a whole. In addition, the following information is available about the three products:

	Large	Medium	Small
Unit selling price	$179		$396	$191
Unit variable cost	141		324	168
Unit contribution margin	$ 38		$72	$23
Autoclave hours per unit	4		6	2
Total process hours per unit	12		12	6
Budgeted units of production	4,900		4,900	4,900

a. Determine the contribution margin by glass type and the total company income from operations for the budgeted units of production.

	Large	Medium	Small	Total
Units produced	fill in the blank 1	fill in the blank 2	fill in the blank 3
Revenues	$fill in the blank 4	$fill in the blank 5	$fill in the blank 6	$fill in the blank 7
Less: Variable costs	fill in the blank 8	fill in the blank 9	fill in the blank 10	fill in the blank 11
Contribution margin	$fill in the blank 12	$fill in the blank 13	$fill in the blank 14	$fill in the blank 15
Less: Fixed costs				fill in the blank 16
Income from operations				$fill in the blank 17

b. Prepare an analysis showing which product is the most profitable per bottleneck hour. Round the "Unit contribution margin per production bottleneck hour" amounts to the nearest cent.

	Large	Medium	Small
Unit contribution margin	$fill in the blank 18	$fill in the blank 19	$fill in the blank 20
Autoclave hours per unit	fill in the blank 21	fill in the blank 22	fill in the blank 23
Unit contribution margin per production bottleneck hour	$fill in the blank 24	$fill in the blank 25	$fill in the blank 26

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