Grouper Chance Co. sells computers and video game systems. The business is divided into two divisions along product lines. Variable costing income statements for the current year are presented below: Sales Variable costs Contribution margin Fixed costs Net income Computers $644,000 386,400 $257,600 Sales mix VG Systems $276,000 Contribution margin ratio 193,200 $82,800 Total $920,000 579,600 Determine the sales mix and contribution margin ratio for each division. Computers 340,400 172,050 $168.350 70 % 60 % VG Systems Calculate the company's weighted-average contribution margin ratio. Weighted-average contribution margin ratio 30 % 30 % %
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- Blossom Electronix sells computer tablets and MP3 players. The business is divided into two divisions along product lines. CVP income statements for a recent quarter's activity are presented below. Sales Variable costs Contribution margin Fixed costs Net income Tablet Division $671,000 496,540 $174,460 MP3 Player Division $429,000 253,110 $175,890 Total $1,100,000 749,650 350,350 128,037 $222,313Cheyenne Chance Co. sells computers and video game systems. The business is divided into two divisions along product lines. Variable costing income statements for the current year are presented below: Computers VG Systems Total Sales $ 704,000 $ 176,000 $ 880.000 Variable costs 352.000 105,600 457,600 Contribution margin $ 352,000 $ 70.400 422,400 Fixed costs 160,320 Net income $ 262,080 Determine the sales mix and contribution margin ratio for each division. Computers VG Systems Sales mix % Contribution margin ratio % Calculate the company's weighted-average contribution margin ratio. Weighted-average contribution margin ratio Calculate the company's break-even point in sales dollars. Break-even point Determine the sales level, in dollars, for each division at the break-even point. Computers VG Systems Break-even point 24Beck Inc. and Bryant Inc. have the following operating data: Beck Inc. Bryant Inc. Sales $170,300 $408,000 Variable costs 68,300 244,800 Contribution margin $102,000 $163,200 Fixed costs 51,000 27,200 Income from operations $51,000 $136,000 a. (pictured) b. (pictured) c. The difference in the (increase/decrease) of income from operations is due to the difference in the operating leverages. Beck Inc.'s (higher/lower) operating leverage means that its fixed costs are a (larger/smaller) percentage of contribution margin than are Bryant Inc.'s.
- Atascadero Industries operates a Manufacturing Division and a Marketing Division. Both divisions are evaluated as profit centers. Marketing buys products from Manufacturing and packages them for sale. Manufacturing sells many components to third parties in addition to Marketing. Selected data from the two operations follow. Capacity (units) Sales price Variable costs Fixed costs Manufacturing 1,070,000 1,750 630 $ $ a. Transfer price b. Transfer price $10,700,000 a For Manufacturing, this is the price to third parties. b For Marketing, this does not include the transfer price paid to Manufacturing. Marketing 507,000 $ 4,900 $ 1,820 $7,270,000 Required: a. Current production levels in Manufacturing are 607,000 units. Marketing requests an additional 107,000 units to produce a special order. What transfer price would you recommend? b. Suppose Manufacturing is operating at full capacity. What transfer price would you recommend? per unit per unitPersonal Electronix sells computer tablets and MP3 players. The business is divided into two divisions along product lines. CVP income statements for a recent quarter’s activity are presented below. Tablet Division MP3 Player Division Total Sales $755,200 $424,800 $1,180,000 Variable costs 543,744 246,384 790,128 Contribution margin $211,456 $178,416 389,872 Fixed costs 133,812 Net income $256,060 Determine the sales level in dollars for each division at the break-even point. (Round computations to 2 decimal places and final answers to 0 decimal places, e.g. 1,526 Do not give answer in image formateAnstell Corporation operates a Manufacturing Division and a Marketing Division. Both divisions are evaluated as profit centers. Marketing buys products from Manufacturing and packages them for sale. Manufacturing sells many components to third parties in addition to Marketing. Selected data from the two operations follow: Capacity (units) Sales price* Variable costst Fixed costs Manufacturing 250,000 $ 310 $ 142 $ 107,500 a. Transfer price b. Transfer price Marketing 125,000 $940 * For Manufacturing, this is the price to third parties. For Marketing, this does not include the transfer price paid to Manufacturing. Required: a. Current output in Manufacturing is 180,000 units. Marketing requests an additional 55,000 units to produce a special order. What transfer price would you recommend? b. Suppose Manufacturing is operating at full capacity. What transfer price would you recommend? per unit per unit $366 $ 727,500
- Asha Inc. and Samir Inc. have the following operating data: Sales Variable costs Contribution margin Fixed costs Asha Inc. $2,500,000 (1,500,000) $1,000,000 (800,000) $200,000 Asha Inc. Samir Inc. Samir Inc. $4,000,000 (2,500,000) $1,500,000 (900,000) $600,000 Operating income a. Compute the operating leverage for Asha Inc. and Samir Inc. If required, round to one decimal place. Asha Inc. 150 75 Samir Inc. b. How much would operating income increase for each company if the sales of each increased by 30%? Dollars Percentage 30 % 30 % c. The difference in the increases of operating income is due to the difference in the operating leverages. Asha Inc.'s higher operating leverage means that its fixed costs are a smaller Inc.'s. percentage of contribution margin than are SamirThe XYZ Company produces and sells two products: The Riffs and The Raffs. Below is revenue and cost information to facilitate the development of a basic segmented income statement. Product Riffs Raffs Sales Price per unit $8.00 6.00 Variable Cost per unit $3.20 3.00 Traceable Fixed Costs $62,000 $44,000 It is expected that the company will incur $21,000 of common fixed expenses and unit sales are expected to be 12,000 of Riffs and 18,000 of Raffs. Required: Construct a Contribution Format Income Statement segmented by product line and company total.Cullumber Company makes three models of tasers. Information on the three products is given below. Sales Variable expenses Contribution margin Fixed expenses Net income (a) Net income $ (b) Shocker Net Income Tingler $300,000 $500,000 Tingler Net Income $ Total Net Income (c) Why or why not? Compute current net income for Cullumber Company. ta Net income would 151,400 148,600 $ 119,400 S $29,200 Fixed expenses consist of $298,000 of common costs allocated to the three products based on relative sales, as well as direct fixed expenses unique to each model of $30,000 (Tingler), $80,800 (Shocker), and $34,300 (Stunner). The common costs will be incurred regardless of how many models are produced. The direct fixed expenses would be eliminated if that model is phased out. James Watt, an executive with the company, feels the Stunner line should be discontinued to increase the company's net income. Shocker 197,000 303,000 229,800 $73,200 Compute net income by product line and in total for…
- Analyzing profitability Camden Company has divided its business into segments based on sales territories: East Coast, Midland, and West Coast. Following are financial data for 2018: Prepare an income statement for Camden Company for 2018 using the contribution margin format assuming total fixed costs for the company Were $435,000. Include columns for each business segment and a column for the total company.Superior Markets, Incorporated, operates three stores in a large metropolitan area. A segmented absorption costing income statement for the company for the last quarter is given below: Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expenses Administrative expenses Total expenses Net operating income (loss) Selling expenses: Sales salaries Direct advertising General advertising* Store rent Depreciation of store fixtures Delivery salaries Depreciation of delivery equipment Total selling expenses *Allocated on the basis of sales dollars. Administrative expenses: Store managers' salaries General office salaries* Superior Markets, Incorporated Income Statement For the Quarter Ended September 30 Insurance on fixtures and inventory Utilities Employment taxes General office-other* Total $ 3,000,000 1,657, 200 1,342,800 Total administrative expenses *Allocated on the basis of sales dollars. 817,000 383,000 1,200,000 $ 142,800 a. The breakdown of the selling…The following CVP income statements are available for Blanc Company and Noir Company. Sales Variable costs Contribution margin Fixed costs Net income (a1) Blanc Company Noir Company $505,000 $505,000 303,000 252,500 252,500 242,400 $10,100 * Your answer is incorrect. Blanc Company 202,000 191,900 $10,100 Calculate Contribution margin ratio. (Round answers to 2 decimal places, e.g. 0.32.) Noir Company Contribution Margin Ratio 40% 50%