(a) Concept introduction: Contribution Margin: The margin of profit which is computed after considering the variable cost only and not the fixed costis known as contribution. In other words, it means the contribution made by selling the product after covering its variable cost to the company. The weighted contribution margin per unit.

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Answer 1

Question

Chapter 6, Problem 18E

To determine

(a)

Concept introduction:

Contribution Margin:

The margin of profit which is computed after considering the variable cost only and not the fixed costis known as contribution. In other words, it means the contribution made by selling the product after covering its variable cost to the company.

The weighted contribution margin per unit.

To determine

(b)

Concept introduction:

Breakeven Point:

The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered.

The breakeven point if the fixed cost is $187,000.

To determine

(c)

Concept introduction:

Target Profit:

The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved.

The total sale units to achieve target profit of $73,000.

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Students have asked these similar questions

Tiago makes three models of camera lens. Its product mix and contribution margin per unit follow: Percentage Contribution of Unit Margin per Unit Lens A Lens B Lens C Sales 24% 44 32 $ 50 42 55 Required: 1. Determine the weighted-average contribution margin per unit. 2. Determine the number of units of each product that Tiago must sell to break even if fixed costs are $189,000. 3. Determine how many units of each product must be sold to generate a profit of $66,000. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Units of Lens A Units of Lens B Units of Lens C Determine how many units of each product must be sold to generate a profit of $66,000. Note: Round your intermediate calculations to nearest whole number. Round your answers up to the next whole number. Round weighted-average contribution margin per unit to 2 decimal places. Units Units Units

Harrington Corporation produces three products, A, B, and C. Pertinent information on these products is as follows: Product Selling Price per Unit Variable Cost per Unit Fixed Costper Unit DL Hoursper Unit A $ 4.00 $ 1.00 $ 2.00 2 B $ 3.50 $ 0.50 $ 2.00 2 C $ 6.00 $ 2.00 $ 3.00 3 The objective function for a linear program to maximize contribution margin from the set of three products is: Multiple Choice Z = $3A + $2.50B + $5C. Z = A + B + C. Z = A + $0.50B + $2C. Z = $3A + $3B + $4C. Z = $4A + $3.50B + $6C.

Craylon Manufacturing Company produces two products, X and Y. The following information is presented for both products: X Y Selling price per unit $40 $25 Variable cost per unit 25 15 Total fixed costs are $275,000.Required:a. Calculate the contribution margin for each product.b. Calculate breakeven point in units of both X and Y if the sales mix is 3 units of X for every unit of Y.c. Calculate breakeven volume in total dollars if the sales mix is 2 units of X for every 3 units of Y.

Answer 2

Question

Chapter 6, Problem 18E

To determine

(a)

Concept introduction:

Contribution Margin:

The margin of profit which is computed after considering the variable cost only and not the fixed costis known as contribution. In other words, it means the contribution made by selling the product after covering its variable cost to the company.

The weighted contribution margin per unit.

To determine

(b)

Concept introduction:

Breakeven Point:

The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered.

The breakeven point if the fixed cost is $187,000.

To determine

(c)

Concept introduction:

Target Profit:

The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved.

The total sale units to achieve target profit of $73,000.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 6, Problem 18E

To determine

(a)

Concept introduction:

Contribution Margin:

The margin of profit which is computed after considering the variable cost only and not the fixed costis known as contribution. In other words, it means the contribution made by selling the product after covering its variable cost to the company.

The weighted contribution margin per unit.

To determine

(b)

Concept introduction:

Breakeven Point:

The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered.

The breakeven point if the fixed cost is $187,000.

To determine

(c)

Concept introduction:

Target Profit:

The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved.

The total sale units to achieve target profit of $73,000.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 6, Problem 18E

To determine

(a)

Concept introduction:

Contribution Margin:

The margin of profit which is computed after considering the variable cost only and not the fixed costis known as contribution. In other words, it means the contribution made by selling the product after covering its variable cost to the company.

The weighted contribution margin per unit.

To determine

(b)

Concept introduction:

Breakeven Point:

The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered.

The breakeven point if the fixed cost is $187,000.

To determine

(c)

Concept introduction:

Target Profit:

The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved.

The total sale units to achieve target profit of $73,000.

Expert Solution & Answer

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Check out a sample textbook solution

See solution

Answer 5

Chapter 6, Problem 18E

To determine

(a)

Concept introduction:

Contribution Margin:

The margin of profit which is computed after considering the variable cost only and not the fixed costis known as contribution. In other words, it means the contribution made by selling the product after covering its variable cost to the company.

The weighted contribution margin per unit.

To determine

(b)

Concept introduction:

Breakeven Point:

The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered.

The breakeven point if the fixed cost is $187,000.

To determine

(c)

Concept introduction:

Target Profit:

The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved.

The total sale units to achieve target profit of $73,000.

Answer 6

Chapter 6, Problem 18E

To determine

(a)

Concept introduction:

Contribution Margin:

The margin of profit which is computed after considering the variable cost only and not the fixed costis known as contribution. In other words, it means the contribution made by selling the product after covering its variable cost to the company.

The weighted contribution margin per unit.

Answer 7

Chapter 6, Problem 18E

To determine

(a)

Concept introduction:

Contribution Margin:

The margin of profit which is computed after considering the variable cost only and not the fixed costis known as contribution. In other words, it means the contribution made by selling the product after covering its variable cost to the company.

The weighted contribution margin per unit.

Answer 8

To determine

(b)

Concept introduction:

Breakeven Point:

The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered.

The breakeven point if the fixed cost is $187,000.

Answer 9

To determine

(b)

Concept introduction:

Breakeven Point:

The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered.

The breakeven point if the fixed cost is $187,000.

Answer 10

To determine

(c)

Concept introduction:

Target Profit:

The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved.

The total sale units to achieve target profit of $73,000.

Answer 11

To determine

(c)

Concept introduction:

Target Profit:

The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved.

The total sale units to achieve target profit of $73,000.

Answer 12

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Answer 13

Expert Solution & Answer

Answer 14

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Answer 15

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Solution Summary: The author explains the concept of contribution margin, which is computed after considering the variable cost only and not the fixed cost.

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(b)

Concept introduction:

Breakeven Point:

The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered.

The breakeven point if the fixed cost is $187,000.

(c)

Concept introduction:

Target Profit:

The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved.

The total sale units to achieve target profit of $73,000.

Want to see the full answer?

Chapter 6 Solutions

Solution Summary: The author explains the concept of contribution margin, which is computed after considering the variable cost only and not the fixed cost.

Concept explainers

Videos

(b) Concept introduction: Breakeven Point: The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered. The breakeven point if the fixed cost is $187,000.

(c) Concept introduction: Target Profit: The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved. The total sale units to achieve target profit of $73,000.

Want to see the full answer?

Chapter 6 Solutions

(b)

Concept introduction:

Breakeven Point:

The level of sales where the company is neither on profit nor loss is termed as breakeven point. In other words, that level of sales at which the fixed cost of the business is recovered.

The breakeven point if the fixed cost is $187,000.

(c)

Concept introduction:

Target Profit:

The target profit is that profit which a company decides to achieve and this analysis helps in determinig the level of sales by which this target can be achieved.

The total sale units to achieve target profit of $73,000.