Benoit Company produces three products, A, B, and C. Data concerning the threeproducts follow (per unit):ProductSelling price702$5060Variable expenses:Direct materials21.0015.004.20Other variable21.0022.5037.80expensesTotal variable42.0037.5042.00expensesContribution margin$28.00$ 12.50$ 18.00Contribution marginratio40%25%30%Demand for the company's products is very strong, with far more orders each monththan the company can produce with the available raw materials. The same material isused in each product. The material costs $6 per pound with a maximum of 4,000pounds available each month.%24 Required:a. Compute contribution margin per pound of materials used. (Round your intermediatecalculations and final answers to 2 decimal places.)Contribution Marginper PoundProduct AProduct BProduct Cb. Which orders would you advise the company to accept first, those for A, for B, or forC? Which orders second? Third?Product AProduct BProduct C

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Answered: Benoit Company produces three products,…

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter12: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 12.16E: Product cost concept of product pricing Based on the data presented in Exercise 12-15, assume that...

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A company has assessed the profitability of its three products as shown here: Product A Product B Product C Total Sales (units) 3,000 5,000 2,000 10,000 £ £ Price 15.00 10.00 5.00 Variable costs 6.00 4.00 3.00 Divisible fixed costs 2.00 1.00 0.50 Non-divisible fixed costs 2.00 2.00 2.00 Profit/(Loss) 5.00 3.00 (0.50) As a result of this, it has been suggested that Product C should be dropped. All other things being equal what would be the financial impact of dropping Product C? A B Profit would increase by £1,000. Profit would increase by £2,000. Profit would fall by £3,000. C D Profit would fall by £4,000. £
Determine the missing amounts. Unit SellingPrice Unit VariableCosts Unit ContributionMargin Contribution MarginRatio 1. $750 $375 $ (a) % (b) 2. $450 $ (c) $153 % (d) 3. $ (e) $ (f) $760 40 %
ed - t 0 ances Benoit Company produces three products-A, B, and C. Data concerning the three products follow (per unit): Product B $ 58.00 Selling price Variable expenses: Direct materials Other variable expenses Total variable expenses Contribution margin Contribution margin ratio A $88.00 26.40 26.40 52.80 $ 35.20 40% 12.00 34.40 46.40 $ 11.60 201 Contribution margin per pound of the constraining resource Required 1 C $ 80.00 12.00 44.00 56.00 $ 24.00 The company estimates it can sell 800 units of each product per month. The same raw material is used in each product. The material costs $3 per pound with a maximum of 5,400 pounds available each month. Required: 1. Calculate the contribution margin per pound of the constraining resource for each product. 2. Which orders would you advise the company to accept first, those for A, B, or C? Which orders second? Third? 3. What is the maximum contribution margin the company can earn per month if it makes optimal use of its 5,400 pounds of…
Product cost concept of product pricing Based on the data presented in Exercise 12-15, assume that Willis Products Inc. uses the product cost concept of applying the cost-plus approach to product pricing. a.Determine the total manufacturing costs and the cost amount per unit for the production and sale of 200,000 units. b.Determine the product cost markup percentage per unit. Round to two decimal place. c.Determine the selling price per unit. Round to the nearest dollar.
Prepare the Income Statement of Rotary Limited for the year ended 28 February 2021 using the following methods of costing: 2.1 Marginal costing | 22 Absorption costing INFORMATION The following information was extracted from the accounting records of Rotary Limited for the year ended 28 February 2021: Inventory on 01 March 2020 Nil Production for the year 35 000 units Sales for the year 30 000 units Fixed costs: Manufacturing R700 000 Sales and administration R480 000 Variable costs per unit: Manufacturing R48 Sales and administration R12 Selling price per unit R150
Benoit Company produces three products, A, B, and C. Data concerning the three products follow(per unit):ProductA B CSelling price ..................................................... $80 $56 $70Variable expenses:Direct materials ............................................ 24 15 9Other variable expenses .............................. 24 27 40Total variable expenses ................................... 48 42 49Contribution margin .......................................... $32 $14 $21Contribution margin ratio .................................. 40% 25% 30%Demand for the company’s products is very strong, with far more orders each month than the companycan produce with the available raw materials. The same material is used in each product. The materialcosts $3 per pound with a maximum of 5,000 pounds available each month.Required:Which orders would you advise the company to accept first, those for A, for B, or for C? Which orderssecond? Third?
Warm Hands, a small company based in Prince Edward Island, manufactures and sells two types of lightweight gloves for runners- Warm and Cozy. Current revenue, cost, and unit sales data for the two products appear below: Warm Cozy $15.00 Selling price per pair Variable expenses per pair Number of pairs sold monthly $10.00 $ 2.50 $ 7.50 2,100 units 700 units Fixed expenses are $2,520 per month.
Matamad Inc. Provides you with the following data on its operation for analysis:Unit selling priceP40Variable costs and expenses per unit.P30Fixed cost and expenses per annum.P48,000REQUIRED:a. Contribution margin per unitb. Contribution margin percentagec. BEP sales volume (units)d. BEP peso salese. Peso sales with desired income of P9,000f. Peso sales with desired income P13,000 after 32% income tax
11. George Corporation has the following information for the current year: Selling price per unit Variable costs per unit 10.00 $ 6.00 $1,000.00 Fixed costs Required: Prepare a cost-volume-profit graph identifying the following items: Total fixed costs line Total variable costs line Total costs line Total revenues line Breakeven point in sales dollars Breakeven point in units Profit area Loss area А. В. С. D. E. F. G. Н. 6,000 5,000 4,000 3,000 2,000 1,000 100 200 300 400 500 Qty (# Units) 3 Dollars ($)
KPR manufactures deals in various products. Relevant details of the products are as under: AWAXAYAZ Estimated annual demand (units)5000100070008000 Sales price per unit (Rs.)150180154175 Material consumption: Q (Rs)2729.524.529.75 Labor hours (Rs)5056.2543.7562.5 Variable overheads (based on labor cost) 70%80%10%90% Fixed overheads per unit (Rs.)10201416 Machine hours required: Processing machine hours 56810 The capacity utilization is as under:Hours Processing machine 150,000 RequiredCompute the number of units of each product that the company should produce in order tomaximize the profit. (B) KPR manufactures is considering a special order for 20 handcrafted gold bracelets to be given as gifts to members of a wedding party. The normal selling price of a gold bracelet is Rs 184 and its unit product cost is Rs140.00 as shown below: Direct materials . . . . . . . . . . . . . . . . . . . . Rs 81.00Direct labor . . . . . . . . . . . . . . . . . . . . . . . 42.00Manufacturing…
I'se the following information to answer questions 1-6. Selling price per unit Luriable manufacturing cost per unit Fixed manufacturing cost per unit V'ariable selling cost per unit Fixed selling cost per unit Expected production and sales P100 20 30 25 10 1,000 units 1. Contribution margin per unit is a. P50 b. P55 с. Р80 d. P15 2. The contribution margin ratio is a. 45% b. 50% c. 55% d. 15%
Assuming Average cost flow method is used, how much is the ending inventroy and cost of sales, respectively? A. 130,300 and 101,000 B. 101,000 and 130,000 C. 105,000 and 126,300 D. 126,300 and 105,000

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