Body World, Inc., produces two basic types of weight-lifting equipment, Model 9 and Model 14. Pertinent...
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Body World, Inc., produces two basic types of weight-lifting equipment, Model 9 and Model 14. Pertinent data are as follows: (Click the icon to view the data.) The weight-lifting craze suggests that Body World can sell enough of either Model 9 or Model 14 to keep the plant operating at full capacity. Both products are processed through the same production departments. Read the requirements. Before determining which products to produce, let's calculate the contribution margin per unit and the contribution margin per machine hour for each machine. (Enter the amounts to the nearest cent.) Selling price per unit - Variable costs per unit = Contribution margin per unit + Relative use of machine-hours per unit of product = Contribution margin per machine hour Body World, Inc. should produce Model 9 135 Model 14 100 1 2 Data Table 3 Selling price A B C Per Unit $ Model 9 Model 14 135.00 $ 100.00 4 Costs 5 Direct material 25.00 17.00 Variable direct manufacturing 6 labor 18.00 23.00 7 Variable manufacturing overhead 21.00 10.50 8 Fixed manufacturing overhead* 6.50 3.25 9 Marketing (all variable) 20.00 8.00 10 Total costs 90.50 61.75 11 Operating income $ 44.50 $ 38.25 Body World, Inc., produces two basic types of weight-lifting equipment, Model 9 and Model 14. Pertinent data are as follows: (Click the icon to view the data.) The weight-lifting craze suggests that Body World can sell enough of either Model 9 or Model 14 to keep the plant operating at full capacity. Both products are processed through the same production departments. Read the requirements. Before determining which products to produce, let's calculate the contribution margin per unit and the contribution margin per machine hour for each machine. (Enter the amounts to the nearest cent.) Selling price per unit - Variable costs per unit = Contribution margin per unit + Relative use of machine-hours per unit of product = Contribution margin per machine hour Body World, Inc. should produce Model 9 135 Model 14 100 1 2 Data Table 3 Selling price A B C Per Unit $ Model 9 Model 14 135.00 $ 100.00 4 Costs 5 Direct material 25.00 17.00 Variable direct manufacturing 6 labor 18.00 23.00 7 Variable manufacturing overhead 21.00 10.50 8 Fixed manufacturing overhead* 6.50 3.25 9 Marketing (all variable) 20.00 8.00 10 Total costs 90.50 61.75 11 Operating income $ 44.50 $ 38.25
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Body World Inc Contribution Margin Analysis Data Table Per Unit Model 9 Model 14 Selling Price 13500 ... View the full answer
Related Book For
Horngrens Cost Accounting A Managerial Emphasis
ISBN: 978-0134475585
16th edition
Authors: Srikant M. Datar, Madhav V. Rajan
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