Multiproduct breakeven analysis, target profit, taxes Johnson Company manufactures a sin- gle product called the Gripper....

 

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Multiproduct breakeven analysis, target profit, taxes Johnson Company manufactures a sin- gle product called the Gripper. Patients, under the direction of physiotherapists, use the Gripper to restore, to the extent possible, normal hand functions. The Gripper has the following per-unit revenue and costs: Revenue... Direct materials cost.. Direct labor cost.. Variable overhead Contribution margin per unit. Johnson Company has fixed manufacturing costs of $1 million per year and fixed general, and administrative expenses of $500,000 per year. Required (a) How many Grippers must Johnson Company sell in order to break even? (b) How many Grippers must Johnson Company sell in order to earn a target profit of $300,000? (c) The Johnson Company sales manager has come up with an idea for a new product called the Gripper Plus. The sales manager is projecting a sales mix of 300,000 units of the Gripper and 100,000 units of the Gripper Plus. The Gripper Plus has the following per-unit revenue and costs: Revenue.. Direct materials cost.. Direct labor cost. Variabie overhead 6 Contribution margin per unit. $10 Multiproduct breakeven analysis, target profit, taxes Johnson Company manufactures a sin- gle product called the Gripper. Patients, under the direction of physiotherapists, use the Gripper to restore, to the extent possible, normal hand functions. The Gripper has the following per-unit revenue and costs: Revenue... Direct materials cost.. Direct labor cost.. Variable overhead Contribution margin per unit. Johnson Company has fixed manufacturing costs of $1 million per year and fixed general, and administrative expenses of $500,000 per year. Required (a) How many Grippers must Johnson Company sell in order to break even? (b) How many Grippers must Johnson Company sell in order to earn a target profit of $300,000? (c) The Johnson Company sales manager has come up with an idea for a new product called the Gripper Plus. The sales manager is projecting a sales mix of 300,000 units of the Gripper and 100,000 units of the Gripper Plus. The Gripper Plus has the following per-unit revenue and costs: Revenue.. Direct materials cost.. Direct labor cost. Variabie overhead 6 Contribution margin per unit. $10

Answer rating: 100% (QA)

a Break even units Fixed Costs Contribution Margin per unit 1500000 6 250000 units b Un... View the full answer