Contribution margin | ||||||||
selling price per unit | 58 | |||||||
less Variable expenses | ||||||||
direct materials | 9.5 | |||||||
direct labor | 12 | |||||||
Variable manufacturing overhead | 3.5 | |||||||
variable selling expense | 2.7 | 27.7 | ||||||
Contribution margin per unit | 30.3 | |||||||
Req 1A | increased sales in units | (88000*20%) | 17600 | |||||
contribution margin per unit | 30.3 | |||||||
incremental contribution margin | 533280 | |||||||
less added fixed selling expense | 130,000 | |||||||
incremental net operarting income | 403,280 | |||||||
1-b) | Yes | |||||||
Req 2 | Break even price per unit | |||||||
Variable manufacturing cost per unit | 25 | |||||||
Shipping cost | 1.5 | |||||||
import duties | 2.7 | |||||||
permits &licences | 0.8 | |||||||
Break even price per unit | 30 | answer | ||||||
Req 3 | Relevant unit cost | $2.70 | per unit | |||||
4) | Foregone contribution margin | (3667*30.3) | 111110.10 | |||||
total avoidable fixed cost | ||||||||
fixed manufacturing overhead cost | (792000*2/12)*60% | 79200 | ||||||
fixed selling cost | (352000*2/12)*20% | 11733 | 90933.33 | |||||
Financial disadvantage | -20176.77 | |||||||
88000*2/12*25%= | 3666.667 | units | ||||||
No | ||||||||
5) | Variable manfuacturing costs | 25 | ||||||
fixed manufacturing overhead cost | (9*30%)= | 2.7 | ||||||
variable selling expense | 2.7*1/3 | 0.90 | ||||||
total costs avoided | 28.60 | |||||||
Andretti Company has a single product called a Dak. The company normally produces and sells 88,000...
Andretti Company has a single product called a Dak. The company normally produces and sells 88,000 Daks each year at a selling price of $64 per unit. The company's unit costs at this level of activity are given below: points Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit $ 9.50 11.00 1.80 7.00 ($616,000 total) 2.70 4.00 ($352,000 total) $36.00 eBook A number of questions relating to the...
Andretti Company has a single product called a Dak. The company normally produces and sells 88,000 Daks each year at a selling price of $62 per unit. The company’s unit costs at this level of activity are given below: Direct materials $ 9.50 Direct labor 9.00 Variable manufacturing overhead 3.60 Fixed manufacturing overhead 4.00 ($352,000 total) Variable selling expenses 4.70 Fixed selling expenses 3.50 ($308,000 total) Total cost per unit $ 34.30 A number of questions relating to the production...
year Andretti Company has a single product called a Dak. The company normally produces and sells 84,000 Daks each selling price of $58 per unit. The company's unit costs at this level of activity are given below: $ 7.50 ON Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit ($420,000 total) 2.50 ($210,000 total) $29.00 $29.00 A number of questions relating to the production and sale of Daks follow....
Andretti Company has a single product called a Dak. The company normally produces and sells 85,000 Daks each year at a selling price of $62 per unit. The company's unit costs at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit $ 7.50 9.00 2.90 7.00 ($595,000 total) 4.70 3.50 ($297,500 total) $34.60 A number of questions relating to the production and...
Andretti Company has a single product called a Dak. The company normally produces and sells 81,000 Daks each year at a selling price of $62 per unit. The company's unit costs at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit $ 8.50 11.00 2.60 4.00 ($324,000 total) 4.70 4.00 ($324,000 total) $ 34.80 A number of questions relating to the production...
Andretti Company has a single product called a Dak. The company normally produces and sells 81,000 Daks each year at a selling price of $60 per unit. The company's unit costs at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit $ 9.50 10.00 3.60 3.00 ($243,000 total) 3.70 3.00 ($243,000 total) $32.80 A number of questions relating to the production and...
Andretti Company has a single product called a Dak. The company normally produces and sells 89,000 Daks each year at a selling price of $60 per unit. The company's unit costs at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit $ 6.50 9.00 3.10 5.00 $445,000 total) 3.70 3.00 ($267,000 total) $ 30.30 A number of questions relating to the production...
Andretti Company has a single product called a Dak. The company normally produces and sells 82,000 Daks each year at a selling price of $62 per unit. The company's unit costs at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit $ 9.50 9.00 3.20 4.00 ($328,000 total) 3.70 3.00 ($246,000 total) $32.40 A number of questions relating to the production and...
Andretti Company has a single product called a Dak. The company normally produces and sells 90,000 Daks each year at a selling price of $60 per unit. The company's unit costs at this level of activity are given below: points Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit $ 7.50 8.00 3.10 8.00 ($720,000 total) 2.70 3.00 ($ 270,000 total) $32.30 eBook Print A number of questions relating...
Andretti Company has a single product called a Dak. The company normally produces and sells 90,000 Daks each year at a selling price of $60 per unit. The company's unit costs at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses Total cost per unit $ 7.50 8.00 3.10 8.00 ($720,000 total) 2.70 3.00 ($270,000 total) $32.30 Book Print A number of questions relating to the...