What is the highest price in terms of a rate per hour that

Assignment Help Accounting Basics

Reference no: EM13576280

The Brandilyn Toy Company manufactures a line of dolls and a doll dress sewing kit. Demand for the dolls is increasing, and management requests assistance from you in determining the best sales and production mix for the coming year. The company has provided the following data:

Product	Demand Next year (units)	Selling Price per Unit	Direct Materials	Direct Labor
Marcy	18,000	$35.00	$3.30	$4.80
Tina	33,000	$25.00	$1.40	$2.40
Cari	30,000	$22.00	$5.20	$9.00
Lenny	55,000	$18.00	$2.30	$6.60
Sewing kit	510,000	$17.00	$1.30	$1.80

The following additional information is available:

a.	The company's plant has a capacity of 129,750 direct labor-hours per year on a single-shift basis. The company's present employees and equipment can produce all five products.
b.	The direct labor rate of $12.00 per hour is expected to remain unchanged during the coming year.
c.	Fixed costs total $296,000 per year. Variable overhead costs are $6.00 per direct labor-hour.
d.	All of the company's nonmanufacturing costs are fixed.
e.	The company's finished goods inventory is negligible and can be ignored.

Required:
1.	Determine the contribution margin per direct labor-hour expended on each product. (Do not round intermediate calculations. Round your answers to 2 decimal places. Omit the "$" sign in your response.)

Product	Contribution margin per DLH
Marcy	$
Tina	$
Cari	$
Lenny	$
Sewing Kit	$

2.	Calculate the the total direct labor-hours that will be required to produce the units estimated to be sold during the coming year. (Do not round intermediate calculations.)

Product	Total DLHs
Marcy
Tina
Cari
Lenny
Sewing Kit

Total DLHs required

4.	What is the highest price, in terms of a rate per hour, that Brandilyn Toy Company should be willing to pay for additional capacity (that is, for added direct labor time)? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

Highest price

$ per hour

Reference no: EM13576280

Questions Cloud

What are the first and last deciles of the standard normal : q1. length of pregnanciesthe length of human pregnancies from conception to birth varies according to a distribution

Assuming this is her only source of income and her marginal : marissa participates in her employers nonqualified deferred compensation plan. for 2013 she is deferring 15 percent of

A population is estimated to have a standard deviation of : a population is estimated to have a standard deviation of 10. we want to estimate the population mean within 2 with a

Customer arrives at a checkout counter in a department : customer arrives at a checkout counter in a department store have a poisson distribution with average of 4 arrivals

What is the highest price in terms of a rate per hour that : the brandilyn toy company manufactures a line of dolls and a doll dress sewing kit. demand for the dolls is increasing

In addition the company had an interest expense of 210 000 : net income and ocf. during 2010 brick paving limited had sales of 2 700 000. cost of goods sold administrative and

Depreciable asset a was purchased january 2 2007 it : on december 31 2010 before the books were closed the management and accountants of madrasa inc. made the following

A coin that has been altered so that the probability of : a coin that has been altered so that the probability of ?ipping heads is 0.4 is ?ipped twice. let x be the number of

A test has a mean of 104 and a standard deviation of 16 we : a test has a mean of 104 and a standard deviation of 16. we want to be 98 certain that we are within 4 points of the

User Account

All Pages