The operating revenues of the three largest business segments for Time Warner, Inc., for a recent...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The operating revenues of the three largest business segments for Time Warner, Inc., for a recent year follow. Each segment includes a number of businesses, examples of which are indicated in parentheses. Turner (cable networks and digital media) Home Box Office (pay television) Time Warner, Inc. Segment Revenues (in millions) $84,600 55,000 Warner Bros. (films, television, and videos) 61,500 Assume that the variable costs as a percent of sales for each segment are as follows: Turner 49% Home Box Office 36% Warner Bros. 38% a. Determine the contribution margin and contribution margin ratio for each segment from the information given. Round contribution margin ratio to whole percents for each segment from the information given. Enter all amounts as positive numbers. Revenues Variable costs Contribution margin Contribution margin ratio (as a percent) Turner % Home Box Office Warner Bros. Frankenreiter Inc. Variable Costing Income Statement For the Year Ended December 31, 20Y1 Sales Variable cost of goods sold: Variable cost of goods manufactured Inventory, December 31 Total variable cost of goods sold Manufacturing margin Total variable selling and administrative expenses Contribution margin Fixed costs: $500,000 (75,000) $228,000 71,400 $884,000 425,000 $459,000 105,400 $353,600 Fixed manufacturing costs I Fixed selling and administrative expenses Total fixed costs 299,400 Income from operations $54,200 Determine the unit cost of goods manufactured, based on (a) the variable costing concept and (b) the absorption costing concept. Variable costing Absorption costing Analyzing Income under Absorption and Variable Costing Variable manufacturing costs are $115 per unit, and fixed manufacturing costs are $84,000. Sales are estimated to be 7,000 units. If an amount is zero, enter "0". Do not round interim calculations. Round final answer to nearest whole dollar. a. How much would absorption costing income from operations differ between a plan to produce 7,000 units and a plan to produce 8,400 units? b. How much would variable costing income from operations differ between the two production plans? Inventory Valuation under Absorption Costing and Variable Costing At the end of the first year of operations, 6,400 units remained in the finished goods inventory. The unit manufacturing costs during the year were as follows Direct materials $75 Direct labor 35 Fixed factory overhead 15 12 Variable factory overhead Determine the cost of the finished goods inventory reported on the balance sheet under (a) the absorption costing concept and (b) the variable costing concept. Absorption costing Variable costing The operating revenues of the three largest business segments for Time Warner, Inc., for a recent year follow. Each segment includes a number of businesses, examples of which are indicated in parentheses. Turner (cable networks and digital media) Home Box Office (pay television) Time Warner, Inc. Segment Revenues (in millions) $84,600 55,000 Warner Bros. (films, television, and videos) 61,500 Assume that the variable costs as a percent of sales for each segment are as follows: Turner 49% Home Box Office 36% Warner Bros. 38% a. Determine the contribution margin and contribution margin ratio for each segment from the information given. Round contribution margin ratio to whole percents for each segment from the information given. Enter all amounts as positive numbers. Revenues Variable costs Contribution margin Contribution margin ratio (as a percent) Turner % Home Box Office Warner Bros. Frankenreiter Inc. Variable Costing Income Statement For the Year Ended December 31, 20Y1 Sales Variable cost of goods sold: Variable cost of goods manufactured Inventory, December 31 Total variable cost of goods sold Manufacturing margin Total variable selling and administrative expenses Contribution margin Fixed costs: $500,000 (75,000) $228,000 71,400 $884,000 425,000 $459,000 105,400 $353,600 Fixed manufacturing costs I Fixed selling and administrative expenses Total fixed costs 299,400 Income from operations $54,200 Determine the unit cost of goods manufactured, based on (a) the variable costing concept and (b) the absorption costing concept. Variable costing Absorption costing Analyzing Income under Absorption and Variable Costing Variable manufacturing costs are $115 per unit, and fixed manufacturing costs are $84,000. Sales are estimated to be 7,000 units. If an amount is zero, enter "0". Do not round interim calculations. Round final answer to nearest whole dollar. a. How much would absorption costing income from operations differ between a plan to produce 7,000 units and a plan to produce 8,400 units? b. How much would variable costing income from operations differ between the two production plans? Inventory Valuation under Absorption Costing and Variable Costing At the end of the first year of operations, 6,400 units remained in the finished goods inventory. The unit manufacturing costs during the year were as follows Direct materials $75 Direct labor 35 Fixed factory overhead 15 12 Variable factory overhead Determine the cost of the finished goods inventory reported on the balance sheet under (a) the absorption costing concept and (b) the variable costing concept. Absorption costing Variable costing
Expert Answer:
Answer rating: 100% (QA)
ANSWER 1 Contribution Margin and Ratio for Time Warner Segments Segment Revenues Variable Costs Contribution Margin Contribution Margin Ratio Turner 8... View the full answer
Related Book For
Financial and Managerial Accounting Using Excel for Success
ISBN: 978-1111993979
1st edition
Authors: James Reeve, Carl S. Warren, Jonathan Duchac
Posted Date:
Students also viewed these accounting questions
-
The operating revenues of the three largest business segments for Time Warner, Inc.,for a recent year are shown below. Each segment includes a number of businesses, examples of which are indicated in...
-
The operating revenues of the three largest business segments for Time Warner, Inc., for a recent year are shown below. Each segment includes a number of businesses, examples of which are indicated...
-
The operating revenues of the three largest business segments for Time Warner, Inc., for a recent year follow. Each segment includes a number of businesses, examples of which are indicated in...
-
A ball is dropped from a high rise platform at t = 0 starting from rest. After 6 seconds another ball is thrown downwards from the same platform with a speed v. The two balls meet at t = 18s. What is...
-
On March 12, 2014, Fontaine agrees to pay Ramos and Briley $12,000 each for a one-third interest in the existing RamosBriley partnership. At the time Fontaine is admitted, each partner has a $30,000...
-
You are standing in a \(1.5-\mathrm{m}\)-deep swimming pool at night. The water is very still. You hold a laser pointer just above the water's surface and shine it nearly parallel to the surface, but...
-
Observations show that it is not possible to blow the table tennis ball from the funnel shown in Fig. P3.122a. In fact, the ball can be kept in an inverted funnel, Fig. P3.122b, by blowing through...
-
What characterizes individuals who feel they have acquired too much debt (DDB Tables 1B through 7B)? What are the marketing implications of this? What are the regulatory implications of this?
-
2. Define "perfect competition" and "monopoly." Besides wheat, list three other products or services that have markets like perfect competition. List three products or services that have markets like...
-
As the auditor of Clearwater County you learn that various assets are subject to spending constraints. Indicate how each of the following constraints would affect the countys reported fund balance...
-
Suppose that you purchase a three-year coupon bond with annual coupons of 2%, paid semi-annually and a face value of $100. Suppose that the term structure is flat at 2% APR compounded semi-annually....
-
According to Paul Krugman, by each country, specializing in products for which it posses comparative advantage, countries could produce more in total and exchange products for goods that were cheaper...
-
Required: For financial accounting purposes, what is the total amount of product costs incurred to make 2 0 , 0 0 0 units? For financial accounting purposes, what is the total amount of period costs...
-
The electromagnetic wave travels 5 m and its magnitude is reduced by a factor of 10 dB. Calculate the attenuation coefficient of this wave.
-
The audit firm Willem & Partners Co is planning a statutory audit of Johnson & Smith Co (the company) for the year ended 31 December 2022. The company produces printers and has been a client of...
-
Fees earned for year 1 were $90,000 and for year 2 were $40,000. What was the percent increase or decrease as per the horizontal analysis?
-
5. Assembling has been identified as the bottleneck in bicycle production. Six employees are available eight hours a day and five days a week in the assembling department. Selling price per unit is...
-
KD Insurance Company specializes in term life insurance contracts. Cash collection experience shows that 20 percent of billed premiums are collected in the month before they are due, 60 percent are...
-
Armstrong Company, operating at full capacity, sold 80,000 units at a price of $124 per unit during 2012. Its income statement for 2012 is as follows: The division of costs between fixed and variable...
-
Capri Wigs Company supplies wigs and hair care products to beauty salons throughout California and the Pacific Northwest. The accounts receivable clerk for Capri Wigs prepared the following partially...
-
Prepare a journal entry for the purchase of office supplies on August 7 for $4,000, paying $1,000 cash and the remainder on account.
-
(a) Among 880 smart phones sold by a retailer, 72 required repairs under the warranty. Estimate the probability that a new phone, which has just been sold, will require repairs under the warranty....
-
A car rental agency has 19 compact cars and 12 intermediate-size cars. If four of the cars are randomly selected for a safety check, what is the probability of getting two of each kind?
-
With reference to Exercise 3.34, suppose that the questionnaire filled in by one of the 150 persons is to be double-checked. If it is chosen in such a way that each questionnaire has a probability of...
Study smarter with the SolutionInn App