Determine the contribution margin per unit of each product

Assignment Help Accounting Basics
Reference no: EM132255751

Question - Futaba photo shop has three services, print, enlargement, and frame. The shop owner thinks these two Services can be sold as a bundle, Print 3, Enlarge 4 and Frame 1. The company spends 10% of selling price as variable advertising expenses. Fixed cost for the shop is $129,320. The following information related to these three services is given.

 

Print

Enlarge

Frame

Selling Price

0.8

1.2

4.5

Direct material and labor costs per unit

0.17

0.31

1.8

Variable manufacturing costs

0.10

0.22

0.5

Expected sales units

45,000

60,000

15,000

Required -

1. Determine the contribution margin per unit of each product.

2. Compute the breakeven point volume for each service. Present supporting calculations

3. What is the total sales units required to earn profit of $252,000 on after tax, the above assumption and a tax rate of 40%?

Reference no: EM132255751

Questions Cloud

Prepare a bank reconciliation dated June : The cash account of Ayayai Corp. shows a ledger balance of $3,954.85 on June 30, 2017. Prepare a bank reconciliation dated June 30
What is the fixed component of overhead manufacturing costs : Sony manufacturing produces and sells DVD players. The selling price for a DVD player is $840. What is the fixed component of overhead manufacturing costs
What amount of FICA taxes does Kyle owe for the year : During that time, he earned $44,000 of self-employment income. What amount of FICA taxes does Kyle owe for the year
Determine the dividends per share for preferred stock : Macy Company has 10,000 shares of 2% cumulative preferred stock of $50 par common stock. Determine the dividends per share for preferred and common stock
Determine the contribution margin per unit of each product : Futaba photo shop has three services, print, enlargement, and frame. Determine the contribution margin per unit of each product
Determine the cash balance per Oriole Limited books : The reconciled cash balance from June's bank reconciliation is $18,340. Determine the cash balance per Oriole Limited's books
What are the credit spreads on the short term bonds : What are the credit spreads on the short term and longer term bonds? Do they seem compatible with the ratings of the bonds?
Which facts lead you to believe that you will need fewer : Which facts lead you to believe that you will need fewer drivers next year? What other information would you want to make a more accurate forecast?
Discuss how a newer entrepreneurial venture might differ : Discuss how a newer entrepreneurial venture might differ from a more mature, intrapreneurial venture in its approach to social media.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Define relation in-procurement and accounting process

Describe the relation between procurement process and accounting process and now they are integrated: and explain bow procurement process have an impact.

  Provide a critical analysis of m and rs implementation

Provide a critical analysis of M&R's implementation of the balanced scorecard, including an identification of the strengths and weaknesses of the program.

  Calculate free cash flow for cypress semiconductor corp

Suppose during 2017 that Cypress Semiconductor Corporation reported net cash provided by operating activities of $87,693,000. Calculate free cash flow.

  Materials and manufacturing overhead resources

Big Thumbs Company manufactures portable flash drives for computers. Big Thumbs incurs monthly depreciation costs of $15,000 on its plant equipment and monthly advertising costs of $3,000 to place advertisements in magazines. Also, each drive requ..

  Discuss legal effect of each of the forms of correspondence

Referring to relevant case law and giving reasons for your propositions, discuss the legal effect of each of the forms of correspondence between Footloose.

  Calculate depreciation under the straight-line method

On June 9, 2013, Dragert Company purchased manufacturing equipment at a cost. Calculate depreciation under the straight-line method for 2013 and 2014.

  Define the operating income and net income

Define the following terms: Operating Income, Net Income, Income Statements and the Principles of Zeroing Out and Earnings per Share

  Effect of the intercompany sale of land

On April 1, 2003, Penny Corporation sells land to its 60%-owned subsidiary, Sahl Corporation, at a $15,000 gain. The land is still held by Sahl on December 31, 2003. What is the effect of the intercompany sale of land on consolidated net income?

  Prepare jansens entry when the cash is received

Jansen Corporation shipped $20,000 of merchandise on consignment to Gooch Company. Jansen paid freight costs of $2,000. Gooch Company paid $500 for local advertising which is reimbursable from Jansen.

  What problems would result in the next accounting period

1. From the information given, record closing entries. 2. If closing entries were not prepared at the end of the accounting period, what problems would result in the next accounting period?

  Write down a 400- to 500-word paper in which you

write a 400- to 500-word paper in which you differentiate between valuation depreciation amortization and depletion. is

  How much gross profit is recognized using percentage

How much gross profit is recognized using percentage of completion method in 2012 and 2013

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd