a-1:
Before Price Reduction | After Price Reduction | Impact | |
Sales Price | $ 396 | $ 351 | |
Quantity | 6,000 | 7,000 | |
Revenue | $ 2,376,000 | $ 2,457,000 | + $ 81,000 |
Variable Manufacturing Costs | 846,000 | 987,000 | (141,000) |
Variable Marketing Costs | 132,000 | 154,000 | ( 22,000) |
Contribution Margin | 1,398,000 | 1,316,000 | ( 82,000) |
Fixed Manufacturing Costs | 342,000 | 342,000 | 0 |
Fixed Marketing Costs | 402,000 | 402,000 | 0 |
Income | $ 654,000 | $ 572,000 | ( 82,000 ) |
a-2. No.
b-1:
Without Government Contract | With Government Contrat | Impact | |||
Regular | Government | Total | |||
Revenue | $ 3,168,000 | $ 2,772,000 | $ 236,750 | $ 3,008,750 | $ ( 159,250) |
Variable Manufacturing Costs | 1,128,000 | 987,000 | 141,000 | 1,128,000 | 0 |
Variable Marketing Costs | 176,000 | 154,000 | 0 | 154,000 | 22,000 |
Contribution Margin | 1,864,000 | 1,631,000 | 95,750 | 1,726,750 | (137,250) |
Fixed Manufacturing Costs | 342,000 | 342,000 | |||
Fixed Marketing Costs | 402,000 | 402,000 | |||
Income | $ 1,120,000 | $ 982,750 | (137,250) |
March income will decrease by $ 137,250.
c.
Minimum unit price | $ 181 |
Minimum unit price = (Variable Manufacturing Costs + Shipping Cost + Marketing Cost ) / 2,000 = ( 141 * 2,000 + 37 * 2,000 + 6,000 ) / 2,000 = $ 181.
d.
Minimum selling price | $ 22 |
Unit variable marketing cost of $ 22 is the only relevant cost, as all manufacturing costs have already been incurred, and therefore are sunk costs.
please only answer clearly Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture...
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table. $ 44 69 19 54 Unit manufacturing costs Variable materials Variable labor Variable overhead Fixed overhead Total unit manufacturing costs Unit marketing costs Variable Fixed Total unit marketing costs Total unit costs $ 186 19 64 4280 83 $ 269 Unless otherwise stated, assume that no connection exists...
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table. $ 44 69 19 54 Unit manufacturing costs Variable materials Variable labor Variable overhead Fixed overhead Total unit manufacturing costs Unit marketing costs Variable Fixed Total unit marketing costs Total unit costs $ 186 19 64 83 $ 269 Unless otherwise stated, assume that no connection exists between...
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table. $ 58 83 33 68 Unit manufacturing costs Variable materials Variable labor Variable overhead Fixed overhead Total unit manufacturing costs Unit marketing costs Variable Fixed Total unit marketing costs Total unit costs $ 242 33 78 111 $ 353 Unless otherwise stated, assume that no connection exists between...
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6.000 units per month are shown in the following table. $53 Unit manufacturing costs Variable materials Variable labor Variable overhead Fixed overhead Total unit manufacturing costs Unit marketing costs Variable Fixed Total unit marketing costs Total unit costs Unless otherwise stated, assume that no connection exists between the situation described in each question, each is independent. Unless otherwise...
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table. Unit manufacturing costs Variable materials $ 52 Variable labor 77 Variable overhead 27 Fixed overhead 62 Total unit manufacturing costs $ 218 Unit marketing costs Variable 27 Fixed 72 Total unit marketing costs 99 Total unit costs $ 317 Unless otherwise stated, assume that no connection exists between...
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table. Unless otherwise stated, assume that no connection exists between the situation described in each question; each is independent. Unless otherwise stated, assume a regular selling price of $376 per unit. Ignore income taxes and other costs that are not mentioned in the table or in the question itself....
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table. Unit manufacturing costs Variable materials $ 52 Variable labor 77 Variable overhead 27 Fixed overhead 62 Total unit manufacturing costs $ 218 Unit marketing costs Variable 27 Fixed 72 Total unit marketing costs 99 Total unit costs $ 317 Unless otherwise stated, assume that no connection exists between...
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table. Unit manufacturing costs Variable materials $ 42 Variable labor 67 Variable overhead 17 Fixed overhead 52 Total unit manufacturing costs $ 178 Unit marketing costs Variable 17 Fixed 62 Total unit marketing costs 79 Total unit costs $ 257 Unless otherwise stated, assume that no connection exists between...
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table Unit manufacturing costs Variable materials $ 51 Variable labor 76 Variable overhead 26 Fixed overhead 61 Total unit manufacturing costs $ 214 Unit marketing costs Variable 26 Fixed 71 Total unit marketing costs 97 Total unit costs $ 311 Unless otherwise stated, assume that no connection exists between...
Davis Kitchen Supply produces stoves for commercial kitchens. The costs to manufacture and market the stoves at the company's normal volume of 6,000 units per month are shown in the following table. Unit manufacturing costs Variable materials $ 52 Variable labor 77 Variable overhead 27 Fixed overhead 62 Total unit manufacturing costs $ 218 Unit marketing costs Variable 27 Fixed 72 Total unit marketing costs 99 Total unit costs $ 317 e-1. A proposal is received from an outside contractor...