D8. Via Gelato is a popular neighborhood gelato shop. The company has provided the following cost formulas and actual results for themonth of June:RevenueRaw materialsWagesUtilitiesRentInsurance.MiscellaneousFixedElementper MonthRevenueExpenses:$ 7,300$ 3,330$ 4,300$ 3,050$ 820$ 2.05While gelato is sold by the cone or cup, the shop measures its activity in terms of the total number of liters of gelato sold. For example,wages should be $7,300 plus $3.10 per liter of gelato sold and the actual wages for June were $26,400. Via Gelato expected to sell6,100 liters in June, but actually sold 6,300 liters.Raw materialsVariableElementper Liter$29.00$6.35$ 3.10$ 1.90Required:Calculate Via Gelato revenue and spending variances for June. (Indicate the effect of each variance by selecting "F" for favorable,"U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)Via GelatoRevenue and Spending VariancesFor the Month Ended June 30WagesUtilitiesRentInsuranceMiscellaneousActualTotal forJune$ 175,540$ 40,630$ 26,400$ 16,100$ 4,300$ 3,050$ 12,990

Variances are the values that are used to measure the difference between the standard and actual…

Via Gelato is a popular neighborhood gelato shop. The company has provided the following cost formulas and actual results for the month of June: Revenue Raw materials Wages Utilities Rent Insurance Fixed Element per Month per Liter $29.00 $ 6.35 $ 3.10 $ 1.90 Variable Element $ 7,300 $ 3,330 $ 4,300 $ 3.050 Actual Total for June $ 175,540 $ 40,630 $ 26,400 $ 16,100 $ 4,300

Via Gelato is a popular neighborhood gelato shop. The company has provided the following cost formulas and actual results for the month of June: Revenue Raw materials Wages Utilities Rent Insurance Fixed Element per Month per Liter $29.00 $ 6.35 $ 3.10 $ 1.90 Variable Element $ 7,300 $ 3,330 $ 4,300 $ 3.050 Actual Total for June $ 175,540 $ 40,630 $ 26,400 $ 16,100 $ 4,300

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter18: Pricing And Profitability Analysis

Section: Chapter Questions

Problem 1CE: Ventana Window and Wall Treatments Company provides draperies, shades, and various window...

See similar textbooks

Similar questions

Stable Paper Delivery has decided to analyze the profitability of five new customers. It buys recycled paper at $12 per case and sells to retail customers at a list price of $14.80 per case. Data pertaining to the five customers are: E (Click the icon to view the data.) Stable Paper Delivery's five activities and their cost drivers are as follows: E (Click the icon to view the activities and cost drivers.) Read the requirements. Requirement 1. Compute the customer-level operating income of each of the five retail Begin by calculating each customer's gross margin. Then calculate the operating incom minus sign for operating losses.) Requirements 1 2 1. Compute the customer-level operating income of each of the five retail customers now being examined (1, 2, 3, 4, and 5). Comment on the results. 2. What insights do managers gain by reporting both the list selling price and the actual selling price for each customer? 3. What factors should managers consider in deciding whether to drop one…
Following is relevant information for Philly's Sandwich Shop, a small business that serves sandwiches: Total fixed cost per month Variable cost per sandwich $1,020.00 1.50 Sales price per sandwich 5.75 During the month of June, Philly's sold 580 sandwiches. Required: Complete the contribution margin income statement for the month of June. Note: Round your final answers to the nearest whole dollar. Philly's Sandwich Shop Contribution Margin Income Statement Month of June Contribution margin Net Operating income
House of Organs, Inc., purchases organs from a well-known manufacturer and sells them at the retail level. The organs sell, on the average, for $2,500 each. The average cost of an organ from the manufacturer is $1,500. The costs that the company incurs in a typical month are presented below: Costs Cost Formula Selling: Advertising . . . . . . . . . . . . . . . . . . . . . . . $950 per monthDelivery of organs . . . . . . . . . . . . . . . $60 per organ soldSales salaries and commissions . . . . . . $4,800 per month, plus 4% of salesUtilities . . . . . . . . . . . . . . . . . . . . . . . . . . $650 per monthDepreciation of sales facilities . . . . . . . . $5,000 per month Administrative: Executive salaries . . . . . . . . . . . . . . . $13,500 per monthDepreciation of…
Following is relevant information for Snowdon Sandwich Shop, a small business that serves sandwiches: Total fixed cost per month $ 1,500 Variable cost per sandwich 2.50 Sales price per sandwich 5.25 During the month of June, Snowdon sold 600 sandwiches.Complete the contribution margin income statement for the month of June.
Following is relevant information for Snowdon Sandwich Shop, a small business that serves sandwiches: Total fixed cost per month $ 1,500 Variable cost per sandwich 2.50 Sales price per sandwich 5.25 During the month of June, Snowdon sold 600 sandwiches.Complete the contribution margin income statement for the month of June. Following is relevant information for Snowdon Sandwich Shop, a small business that serves sandwiches: Total fixed cost per month $ 1,500 Variable cost per sandwich 2.50 Sales price per sandwich 5.25 During the month of June, Snowdon sold 600 sandwiches.Complete the contribution margin income statement for the month of June. SNOWDON SANDWICH SHOP Contribution Margin Income Statement Month of June Contribution margin Net Operating income
Milano Pizza is a small neighborhood pizzeria that has a small area for in-store dining as well as offeringtake-out and free home delivery services. The pizzeria’s owner has determined that the shop has two majorcost drivers—the number of pizzas sold and the number of deliveries made. Data concerning the pizzeria’scosts appear below:Fixed Cost Cost per Cost perper Month Pizza DeliveryPizza ingredients ............... $3.80Kitchen staff ....................... $5,220Utilities ............................... $630 $0.05Delivery person .................. $3.50Delivery vehicle ................. $540 $1.50Equipment depreciation ..... $275Rent ................................... $1,830Miscellaneous .................... $820 $0.15In November, the pizzeria budgeted for 1,200 pizzas at an average selling price of $13.50 per pizzaand for 180 deliveries.Data concerning the pizzeria’s operations in November appear below:Actual ResultsPizzas ................................... 1,240Deliveries…
A store pays $60 for a set of cookware. Overhead expense on each cookware is 6% of the selling price and the profit is 17% of the selling price. Fill in the missing values in the given merchandizing-calculation table. (Round your answers to two decimal places if needed) Profit (P) Amount ($) Expenses (E) Markup (M) $ Cost (C) Selling Price (S) $ S SA Next Question On cost Markup Rate (%) % On Selling price %
Ventana Window and Wall Treatments Company provides draperies, shades, and various window treatments. Ventana works with the customer to design the appropriate window treatment, places the order, and installs the finished product. Direct materials and direct labor costs are easy to trace to the jobs. Ventanas income statement for last year is as follows: Ventana wants to find a markup on cost of goods sold that will allow them to earn about the same amount of profit on each job as was earned last year. Required: 1. What is the markup on cost of goods sold (COGS) that will maintain the same profit as last year? (Round the percentage to two significant digits.) 2. A customer orders draperies and shades for a remodeling job. The job will have the following costs: What is the price that Ventana will quote given the markup percentage calculated in Requirement 1? (Round the price to the nearest dollar.) 3. What if Ventana wants to calculate a markup on direct materials cost, since it is the largest cost of doing business? What is the markup on direct materials cost that will maintain the same profit as last year? (Round the percentage to two significant digits.) What is the bid price Ventana will use for the job given in Requirement 2 if the markup percentage is calculated on the basis of direct materials cost? (Round to the nearest dollar.)
The following table provides monthly revenue values for Tedstar, Inc., a company that sells valves to large industrial firms. The monthly revenue data have been graphed using a line chart in the following figure. a. What are the problems with the layout and display of this line chart? b. Create a new line chart for the monthly revenue data at Tedstar, Inc. Format the chart to make it easy to read and interpret.
Maria's Food Service provides meals that nonprofit organizations distribute to handicapped and elderly people. The following is her forecasted income statement for April, when she expects to produce and sell 2,200 meals: Amount Per Unit Sales revenue $ 11,440 $ 5.20 Costs of meals produced 9,020 4.10 Gross profit $ 2,420 $ 1.10 Administrative costs 1,100 0.50 Operating profit $ 1,320 $ 0.60 Fixed costs included in this income statement are $3,124 for meal production and $440 for administrative costs. Maria has received a special request from an organization sponsoring a picnic to raise funds for the Special Olympics. This organization is willing to pay $3.10 per meal for 300 meals on April 10. Maria has sufficient idle capacity to fill this special order. These meals will incur all of the variable costs of meals produced, but variable administrative costs and total fixed costs will not be affected. Required: a. What…
Maria's Food Service provides meals that nonprofit organizations distribute to handicapped and elderly people. The following is her forecasted income statement for April, when she expects to produce and sell 2,900 meals: Amount Per Unit Sales revenue $ 17,110 $ 5.90 Costs of meals produced 12,905 4.45 Gross profit $ 4,205 $ 1.45 Administrative costs 2,320 0.80 Operating profit $ 1,885 $ 0.65 Fixed costs included in this income statement are $4,321 for meal production and $580 for administrative costs. Maria has received a special request from an organization sponsoring a picnic to raise funds for the Special Olympics. This organization is willing to pay $3.45 per meal for 300 meals on April 10. Maria has sufficient idle capacity to fill this special order. These meals will incur all of the variable costs of meals produced, but variable administrative costs and total fixed costs will not be affected. Required: a. What…
Living Corner sells home wares and various otherreading-related products. One of the store's most popular products is the fluffy pillow. The pillow each sell for $26.00. Originally the pillows were handmade by a local artisan. The store's owner has been impressed with the demand for the pillow and has recently begun a small manufacturing company to produce and distribute the pillow to other stores. Estimated sales for the fourth quarter (in units) are as follows: October 9 500 November 10 200 December 12 600 Total 32 300 Required: a) Prepare a sales budget for the fourth quarter based on the above information. b) Prepare a production budget for the pillow manufacturing company. The company did not have any inventory at the end of September, but they want to maintain a 20 percent inventory at the end of each month based on the next month's sales. January's sales are expected to be low, given the post-holiday trends and are estimated to be 6800 units. c) Explain the benefits of budgeting…