Hometown Bakery sells three types of doughnuts: glazed, jelly, and cake. The following table shows the...
Hometown Bakery sells three types of doughnuts: glazed, jelly,
and cake. The following table shows the sales price and variable
costs for each type. The bakery incurs $300,000 a year in fixed
expenses. Assume that it sells 2 glazed doughnuts for every 1 jelly
doughnut and every 1 cake doughnut.
| DOUGHNUT TYPE | SALES PRICE | VARIABLE COST | |||
| Glazed | $0.35 | $0.2 | |||
| Jelly | $0.5 | $0.45 | |||
| Cake | $0.40 | $0.27 |
How many doughnuts of each type will be sold at the breakeven point?
| Jelly doughnuts |
|
|
| Cake doughnuts |
|
|
| Glazed doughnuts |
|
What amount of revenue would need to be generated by each type of doughnut for the company to earn $60,000 in operating income?
Jelly doughnuts$
Cake doughnuts$
Glazed doughnuts$
Homework Answers
1) Weighted average contribution margin per unit = (0.35-.20)*50%+(0.50-0.45*25%)+(0.40-0.27)*25% = 0.12
Break even point = 300000/.12 = 2500000
| Jelly doughnuts (2500000*25%) | 625000 | |
| Cake doughnuts | 625000 | |
| Glazed doughnuts | 1250000 |
2) required unit = (300000+60000)/0.12 = 3000000
| Jelly doughnuts | 750000 | |
| Cake doughnuts | 750000 | |
| Glazed doughnuts | 1500000 |
Add Answer to:
Hometown Bakery sells three types of doughnuts: glazed, jelly,
and cake. The following table shows the...
please help me answer this by 10pm tonight. thank you!! Hometown Bakery sells three types of...
please help me answer this by 10pm tonight. thank you!!
Hometown Bakery sells three types of doughnuts: glazed, jelly, and cake. The following table shows the sales price and variable costs for each type. The bakery incurs $343,000 a year in fixed expenses. Assume that it sells 4 glazed doughnuts for every 1 jelly doughnut and every 1 cake doughnut. DOUGHNUT TYPE SALES PRICE VARIABLE COST Glazed $0.35 $0.26 Jelly $0.57 $0.49 Cake $0.43 $0.27 (a) Your answer is incorrect....
please help me answer part B by 10pm tonight. please make sure the answer is correct...
please help me answer part B by 10pm tonight. please make sure
the answer is correct and answer all parts to b. thank you!!
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please help me answer this by 10pm tonight. thank you!!
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please help me answer part B by 10pm tonight. please make sure
the answer is correct and answer all parts to b. thank you!!
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