The Chair Division currently purchases the cushions for $30 from an outside vendor. The Cushion Division...
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The Chair Division currently purchases the cushions for $30 from an outside vendor. The Cushion Division manufactures upholstered seat cushions that are sold to customers outside the company. The Chair Division currently sells 1,100 chairs per quarter, and the Cushion Division is operating at capacity, which is 1,100 cushions per quarter. The two divisions report the following information: Chair Division Sales Price per Chair Variable Cost (other than cushion) Variable Cost (cushion) Contribution Margin per Chair $ 110 40 30 $ 40 Cushion Division Sales Price per Cushion Variable Cost per Cushion Contribution Margin per Cushion $ 34 8 26 Requirement 1. Determine the total contribution margin for Greco Company for the quarter. Chair Division Cushion Division Total Number of units X Contribution margin per unit X X 11 Total contribution margin The Chair Division currently purchases the cushions for $30 from an outside vendor. The Cushion Division manufactures upholstered seat cushions that are sold to customers outside the company. The Chair Division currently sells 1,100 chairs per quarter, and the Cushion Division is operating at capacity, which is 1,100 cushions per quarter. The two divisions report the following information: Chair Division Sales Price per Chair Variable Cost (other than cushion) Variable Cost (cushion) Contribution Margin per Chair $ 110 40 30 $ 40 Cushion Division Sales Price per Cushion Variable Cost per Cushion Contribution Margin per Cushion $ 34 8 26 Requirement 1. Determine the total contribution margin for Greco Company for the quarter. Chair Division Cushion Division Total Number of units X Contribution margin per unit X X 11 Total contribution margin
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1 Number of units X Contribution margin per unit Total contribution margin Chair Division 1100 X 40 ... View the full answer
Related Book For
Financial Accounting An Integrated Statements Approach
ISBN: 978-0324312119
2nd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
Posted Date:
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