Bramble Corporation makes two products, footballs and baseballs. Additional information follows:FootballsBaseballsUnits2,0002,500Sales$144,000$60,000Variable costs57,60033,000Fixed costs24,00012,600Net income$62,400$14,400Yards of leather per unit1.250.30Net income per unit$31.20$5.76Unit contribution margin$43.20$10.80Assume that Bramble is able to order an additional 4,000 yards of leather and wishes to maximize its net income. Of the additionalunits it produces, at least 800 of each product are necessary for sales.How many units of each must be produced? (Round contribution margin per yard to 2 decimal places, e.g. 52.75 and final answers to Odecimal places, e.g. 5,275.)Units produceFootballsBaseballs

Step 1: Calculation of the contribution margin per yards of leather: Foot…

Answered: Bramble Corporation makes two products,…

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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Ivanhoe Company makes three models of tasers. Information on the three products is given below. Tingler Shocker Stunner Sales $296,000 $504,000 $200,000 Variable expenses 151,100 203,300 138,600 Contribution margin 144,900 300,700 61,400 Fixed expenses 116,616 228,184 93,900 Net income $28,284 $72,516 $(32,500) Fixed expenses consist of $296,000 of common costs allocated to the three products based on relative sales, as well as direct fixed expenses unique to each model of $29,000 (Tingler), $79,000 (Shocker), and $34,700 (Stunner). The common costs will be incurred regardless of how many models are produced. The direct fixed expenses would be eliminated if that model is phased out.James Watt, an executive with the company, feels the Stunner line should be discontinued to increase the company’s net income.(a)Compute current net income for Ivanhoe Company. Net income $ (b)Compute net income by product line…
Gallery Corporation makes two products, footballs and baseballs. Additional information follows: Footballs Baseballs Units 2,000 2,500 Sales $60,000 $25,000 Variable costs 24,000 13,750 Fixed costs 10,000 5,250 Net income $26,000 $6,000 Yards of leather per unit 1.25 0.30 Profit per unit $13.00 $2.40 Contribution margin per unit $18.00 $4.50 Assume that Gallery is able to order an additional 2,500 yards of leather and wishes to maximize its income. Of the additional units it produces, at least 500 of each product are necessary for sales.How many units of each must be produced?
Ayayai Corporation makes two products, footballs and baseballs. Additional information follows: Footballs Baseballs Units 2,000 2,500 Sales $48,000 $20,000 Variable costs 19,200 11,000 Fixed costs 8,000 4,200 Net income $20,800 $4,800 Yards of leather per unit 1.25 0.30 Net income per unit $10.40 $1.92 Unit contribution margin $14.40 $3.60 Assume that Ayayai is able to order an additional 2,000 yards of leather and wishes to maximize its net income. Of the additional units it produces, at least 400 of each product are necessary for sales. How many units of each must be produced? (Round contribution margin per yard to 2 decimal places, e.g. 52.75 and final answers to O decimal places, e.g. 5,275.)
Vaughn, Inc. currently manufactures a wicket as its main product. Costs per unit are as follows: Direct materials and direct labor $11 Variable overhead Fixed overhead Total 5 8 $24 Saran Company has contacted Vaughn with an offer to sell it 6400 wickets for $18 each. Of Vaughn's $8 per unit fixed cost. $5 per unit is unavoidable. Should Vaughn make or buy the wickets and why? O Make because the cost savings is $12800 ◇ Buy because the cost savings is $6400 ○ Buy because the cost savings is $19200 ○ Make because the cost savings is $6400
Sandy Bank, Inc., makes one model of wooden canoe. and, the information for it follows: Number of canoes produced and sold Total costs 450 650 800 Variable costs $ 69,750 $ 468,000 $100,750 $468,000 $124,000 $468,000 Fixed costs $537,750 $568,750 $592,000 Total costs Cost per unit Variable cost per unit Fixed cost per unit $ 155.00 155.00 155.00 720.00 1,040.00 585.00 $ 875.00 Total cost per unit $1,195.00 $ 740.00 Sandy Bank sells its canoes for $375 each. Required: 1. Suppose that Sandy Bank raises its selling price to $500 per canoe. Calculate its new break-even point in units and in sales dollars. 2. If Sandy Bank sells 1,500 canoes, compute its margin of safety in units and as a percentage of sales. (Use the new sales price of $500.) 3. Calculate the number of canoes that Sandy Bank must sell at $500 each to generate $110,000 profit.
CVP single product; comprehensiveBeantown Baseball Company makes baseballs that sell for $13 per two-pack. Current annual production and sales are 960,000 baseballs. Costs for each baseball are as follows:Direct material$2.00Direct labor1.25Variable overhead0.50Variable selling expenses0.25Total variable cost$4.00Total fixed overhead$1,250,000a. Calculate the unit contribution margin in dollars and the contribution margin ratio for the company.Note: Round percentage to two decimal places (for example, round 32.5555% to 32.56%).Unit contribution margin in dollars $AnswerContribution margin ratio Answer%\\n
Sheridan, Inc. currently manufactures a wicket as its main product. Costs per unit are as follows: Direct materials and direct labor $11 Variable overhead Fixed overhead Total 7 9 $27 Saran Company has contacted Sheridan with an offer to sell it 5400 wickets for $21 each. Of Sheridan's $9 per unit fixed cost, $5 per unit is unavoidable. Should Sheridan make or buy the wickets and why? O Make because the cost savings is $16200 O Make because the cost savings is $5400 O Buy because the cost savings is $10800 O Buy because the cost savings is $5400
The following costs are for Optical View Incorporated, a contact lens manufacturer: Output in Units Fixed Costs Variable Costs Total Costs 250 $ 4,750 $ 7,500 $ 12,250 300 4,750 9,000 13,750 350 4,750 10,500 15,250 400 4,750 12,000 16,750 For each level of output calculate the per-unit total cost, per-unit variable cost, and per-unit fixed cost. (Round your answers to the nearest whole dollar amount.)
Mountain Technical manufactures mountaineering tents. It has fixed costs of $8,280,000. Mountain Technical's unit cost and sales data is shown as follows: Ranier Shasta Whitney Model Model Model Unit sales price $300 $400 $500 Unit variable costs $260 $340 $380 Units sold 48,000 72,000 40,000 What is the weighted-average unit contribution margin? A. $220 B. $57 C. $73 D. $69 Determine the number of units of each model that the company must sell to break even: Group of answer choices A. Ranier - 36,000 units; Shasta - 54,000 units; Whitney –…
Curiumber Enterprises is considering manufacturing a new product. It projects the cost of direct materials and rent for a range or output as follows. Output in Units 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 Rent Cost 11.000 $5,290 5,290 8,464 8,464 8,464 8,464. 8,464 8.464 10.580 10,000 10,580 10.580 Direct Materials $4,200 7,200 7,200 9,600. 12,000 14,400 16.800 19,200 30.999 37,030 46.552
Structuring a Keep-or-Drop Product Line Problem Shown below is a segmented income statement for Orzo Company's three laminated flooring product lines: Strip Plank Parquet Total Sales revenue $400,000 $200,000 $300,000 $900,000 Less: Variable expenses 225,000 120,000 250,000 595,000 Contribution margin $175,000 $ 80,000 $ 50,000 $305,000 Less direct fixed expenses: Machine rent (5,000) (20,000) (50,000) (75,000) Supervision (15,000) (10,000) (20,000) (45,000) Depreciation (35,000) (10,000) (25,000) (70,000) Segment margin $120,000 $ 40,000 $ (45,000) $115,000 Orzo's management is deciding whether to keep or drop the parquet product line. Orzo's parquet flooring product line has a contribution margin of $50,000 (sales of $300,000 less total variable costs of $250,000). All variable costs are relevant. Relevant fixed costs associated with this line include $30,000 in machine rent and $4,700 in supervision salaries. Required: 1. List…
Shown below is a segmented income statement for Orzo Company's three laminated flooring product lines: Line Item Description Strip Plank Parquet Total Sales revenue $400,000 $200,000 $300,000 $900,000 Less: Variable expenses 225,000 120,000 250,000 595,000 Contribution margin $175,000 $ 80,000 $ 50,000 $305,000 Less direct fixed expenses: Machine rent 5,000 20,000 42,000 67,000 Supervision 15,000 10,000 20,000 45,000 Depreciation 35,000 10,000 25,000 70,000 Segment margin $120,000 $ 40,000 $ (37,000) $123,000 Orzo's management is deciding whether to keep or drop the parquet product line. Orzo's parquet flooring product line has a contribution margin of $50,000 (sales of $300,000 less total variable costs of $250,000). All variable costs are relevant. Relevant fixed costs associated with this line include $42,000 in machine rent and $5,000 in supervision salaries. 1) Which alternative is more cost effective and by how much?____

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