Homework Answers
Erosion cost is the contribution margin lost on existing bike = (100-40)*7,500 = $450,000
Net benefit = (370-225)*15,000 – 450,000
= $1,725,000
Yes, should be introduced since net benefit
i.e. B
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Erosion costs. Fat Tire Bicycle Company currently sells 39,000 bicycles per year. The current bike is a standard ba...
10.1 Erosion costs. Fat Tire Bicycle Company currently sells 39,000 bicycles per year. The current bike...
10.1 Erosion costs. Fat Tire Bicycle Company currently sells 39,000 bicycles per year. The current bike is a standard balloon-tire bike selling for $110, with a production and shipping cost of $30. The company is thinking of introducing an off-road bike with a projected selling price of $410 and a production and shipping cost of $250. The projected annual sales for the off-road bike are 16,000. The company will lose sales in fat-tire bikes of 9,500 units per year if...
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Week 5 Project Built Right Bike Company (BRBC) is an established manufacturer of quality bicycles. They...
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The Giseppe Tire Company manufactures racing tires for bicycles. sells tires for $80 each. Giseppe is...
The Giseppe Tire Company manufactures racing tires for bicycles.
sells tires for $80 each. Giseppe is planning for the next year by
developing a master budget by quarters. balance sheet for
follows
Requirements:
1.Prepare Giseppe'operating budget and cash budget for 2019 by
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production budget, direct materials budget, direct labor budget,
manufacturing overhead budget, cost of goods sold budget, selling
and administrative expense budget, schedule of cash receipts,
schedule of cash payments, and...
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The Gerard Tire Company manufactures racing tires for bicycles.
Gerard sells tires for $90 each. Gerard is planning for the next
year by developing a master budget by quarters. Gerard’s balance
sheet for December 31, 2018, follows:
Other data for Gerard Tire Company:
Budgeted sales are 1,500 tires for the first quarter and
expected to increase by 200 tires per quarter. Cash sales are
expected to be 10% of total sales, with the remaining 90% of sales
on account.
Finished...
The Gerard Tire Company manufactures racing tires for bicycles. Gerard sells tires for $90 each. ...
The Gerard Tire Company manufactures racing tires for bicycles.
Gerard sells tires for $90 each. Gerard is planning for the next
year by developing a master budget by quarters. Gerard’s balance
sheet for December 31, 2018, follows:
Other data for Gerard Tire Company:
Budgeted sales are 1,500 tires for the first quarter and
expected to increase by 200 tires per quarter. Cash sales are
expected to be 10% of total sales, with the remaining 90% of sales
on account.
Finished...
The Grady Tire Company manufactures racing tires for bicycles. Grady sells tires for $70 each. Grady...
The Grady Tire Company manufactures racing tires for bicycles. Grady sells tires for $70 each. Grady is Other data for Grady Tire Com planning for the next year by developing a master budget by quarters. Grady's balance sheet for (Click the icon to view the December 31, 2018, follows: B (Click the icon to view the balance sheet.) Read the requirements Selling and Administrative Expense Budget For the Year Ended December 31, 2019 First Second Third Fourth Quarter Quarter Quarter...
Scenario: Styles Wing Bicycle Company manufactures and sells 2 sizes of bicycles, 21.5 inch and 22.5...
Scenario: Styles Wing Bicycle Company manufactures and sells 2 sizes of bicycles, 21.5 inch and 22.5 inch. Sales Their sales team has committed to the following projected monthly unit sales for the next year. Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov 21.5 Bike 368 472 633 616 443 345 322 317 317 317 328 22.5 Bike 320 410 550 535 385 300 280 275 275 275 285 Dec 420 365 The selling price for the 21.5...
Erosion costs. Fat Tire Bicycle Company currently sells 36,000 bicycles per year. The current bike is a standard balloon-tire bike selling for $120, with a production and shipping cost of $30. The company is thinking of introducing an off-road bike with a projected selling price of $390 and a production and shipping cost of $300. The projected annual sales for the off-road bike are 15,000 The company will lose sales in fat-tire bikes of 8,500 units per year if it...
The Regal Cycle Company manufactures three types of bicycles-a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Dirt Mountain Racing Total Bikes Bikes Bikes $920,000 $264,000 $ 404,000 $ 252,000 475,000 117,000 199,000 159,000 445,000 147,000 205,000 93,000 Sales Variable manufacturing and selling expenses Contribution margin Fixed expenses: Advertising, traceable Depreciation of special equipment Salaries of product-line managers Allocated common fixed expenses* Total fixed expenses Net operating income (loss)...
The Giseppe Tire Company manufactures racing tires for bicycles.
sells tires for $80 each. Giseppe is planning for the next year by
developing a master budget by quarters. balance sheet for
follows
Requirements:
1.Prepare Giseppe'operating budget and cash budget for 2019 by
quarter. Required schedules and budgets include: sales budget,
production budget, direct materials budget, direct labor budget,
manufacturing overhead budget, cost of goods sold budget, selling
and administrative expense budget, schedule of cash receipts,
schedule of cash payments, and...
The Gerard Tire Company manufactures racing tires for bicycles.
Gerard sells tires for $90 each. Gerard is planning for the next
year by developing a master budget by quarters. Gerard’s balance
sheet for December 31, 2018, follows:
Other data for Gerard Tire Company:
Budgeted sales are 1,500 tires for the first quarter and
expected to increase by 200 tires per quarter. Cash sales are
expected to be 10% of total sales, with the remaining 90% of sales
on account.
Finished...
The Gerard Tire Company manufactures racing tires for bicycles.
Gerard sells tires for $90 each. Gerard is planning for the next
year by developing a master budget by quarters. Gerard’s balance
sheet for December 31, 2018, follows:
Other data for Gerard Tire Company:
Budgeted sales are 1,500 tires for the first quarter and
expected to increase by 200 tires per quarter. Cash sales are
expected to be 10% of total sales, with the remaining 90% of sales
on account.
Finished...
The Grady Tire Company manufactures racing tires for bicycles. Grady sells tires for $70 each. Grady is Other data for Grady Tire Com planning for the next year by developing a master budget by quarters. Grady's balance sheet for (Click the icon to view the December 31, 2018, follows: B (Click the icon to view the balance sheet.) Read the requirements Selling and Administrative Expense Budget For the Year Ended December 31, 2019 First Second Third Fourth Quarter Quarter Quarter...
Scenario: Styles Wing Bicycle Company manufactures and sells 2 sizes of bicycles, 21.5 inch and 22.5 inch. Sales Their sales team has committed to the following projected monthly unit sales for the next year. Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov 21.5 Bike 368 472 633 616 443 345 322 317 317 317 328 22.5 Bike 320 410 550 535 385 300 280 275 275 275 285 Dec 420 365 The selling price for the 21.5...
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