Williams Gear makes and sells three types of computer laptop sleeves: leather, fabric, and plastic. Management...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Williams Gear makes and sells three types of computer laptop sleeves: leather, fabric, and plastic. Management is trying to determine the most profitable mix. Sales prices, demand, and use of manufacturing inputs follow: Sales price. Maximum quarterly demand (sleeves) Input requirements per unit Direct material quantity per sleeve (ounces) Direct material price per ounce of material Direct labor quantity per sleeve (hours) Direct labor price per hour Other Costs Variable costs Factory overhead Marketing Quarterly fixed costs Manufacturing Marketing Administration Leather $ 160 2,840 $ 76,800 $ 20,100 $ 65,100 16 $ 4.25 8.90 $ 35 $5 per direct labor-hour $ 6% of sales price Fabric $70 13,350 6 $ 6.17 0.4 $ 35 Plastic $ 40 21,700 10 $ 2.37 0.3 $ 35 Williams has two production limits: (1) the demand for the individual sleeves (see maximum quarterly demand) and (2) 10,170 direct labor-hours per quarter caused by the physical layout of the production area, requirement c. d-2. How much operating profit should your recommended product mix generate? Required: a-1. Assuming the company can satisfy the annual demand, calculate the contribution margin for each type of sleeve using the table below. a-2. How much operating profit could Williams earn if it were able to satisfy the annual demand? b-1. Compute the contribution margin for each sleeve per the constrained resource, direct labor. b-2. Which of the three product lines makes the most profitable use of the constrained resource, direct labor? c. Given the information so far, what product mix do you recommend? d-1. Calculate the contribution margin for each type of sleeve using the product mix recommended in e. Suppose that the company could expand its labor capacity by leasing a new stitching machine that will free up 2,364 direct labor hours per quarter. What is the maximum quarterly lease payment that Williams Gear would be willing to pay? f. Suppose the company selling the stitching machine is not quite sure without further analysis how many direct labor hours the new machine would free up. Regardless of the number of new hours, what the maximum quarterly lease payment Williams Gear would be willing to pay? Williams Gear makes and sells three types of computer laptop sleeves: leather, fabric, and plastic. Management is trying to determine the most profitable mix. Sales prices, demand, and use of manufacturing inputs follow: Sales price. Maximum quarterly demand (sleeves) Input requirements per unit Direct material quantity per sleeve (ounces) Direct material price per ounce of material Direct labor quantity per sleeve (hours) Direct labor price per hour Other Costs Variable costs Factory overhead Marketing Quarterly fixed costs Manufacturing Marketing Administration Leather $ 160 2,840 $ 76,800 $ 20,100 $ 65,100 16 $ 4.25 8.90 $ 35 $5 per direct labor-hour $ 6% of sales price Fabric $70 13,350 6 $ 6.17 0.4 $ 35 Plastic $ 40 21,700 10 $ 2.37 0.3 $ 35 Williams has two production limits: (1) the demand for the individual sleeves (see maximum quarterly demand) and (2) 10,170 direct labor-hours per quarter caused by the physical layout of the production area, requirement c. d-2. How much operating profit should your recommended product mix generate? Required: a-1. Assuming the company can satisfy the annual demand, calculate the contribution margin for each type of sleeve using the table below. a-2. How much operating profit could Williams earn if it were able to satisfy the annual demand? b-1. Compute the contribution margin for each sleeve per the constrained resource, direct labor. b-2. Which of the three product lines makes the most profitable use of the constrained resource, direct labor? c. Given the information so far, what product mix do you recommend? d-1. Calculate the contribution margin for each type of sleeve using the product mix recommended in e. Suppose that the company could expand its labor capacity by leasing a new stitching machine that will free up 2,364 direct labor hours per quarter. What is the maximum quarterly lease payment that Williams Gear would be willing to pay? f. Suppose the company selling the stitching machine is not quite sure without further analysis how many direct labor hours the new machine would free up. Regardless of the number of new hours, what the maximum quarterly lease payment Williams Gear would be willing to pay?
Expert Answer:
Related Book For
Fundamentals of Cost Accounting
ISBN: 978-0077398194
3rd Edition
Authors: William Lanen, Shannon Anderson, Michael Maher
Posted Date:
Students also viewed these accounting questions
-
Austin Enterprises makes and sells three types of dress shirts. Management is trying to determine the most profitable mix. Sales prices, demand, and use of manufacturing inputs follow: The company...
-
The Tiger Catering Company is trying to determine the most economical combination of sandwiches to make for a tennis club. The club has asked Tiger to provide 70 sandwiches in a variety to include...
-
Austin Enterprises makes and sells three types of dress shirts. Management is trying to determine the most profitable mix. Sales prices, demand, and use of manufacturing inputs follow. Basic Classic...
-
What sort of debates or experiences would get overlooked if professionals and researchers ignored these distinctions? How would you classify the following? An assigned expatriate who falls in love...
-
Repeat the Problem 1.31 including a contact resistance of 0.1 K/W at each of the interfaces. Problem 1.31: A section of a composite wall with the dimensions shown in the schematic diagram below has...
-
Maison Inc. reported the following selected information at December 31. Calculate (a) the current ratio (b) the debt to assets ratio for December 31, 2025. Total current assets Total assets Total...
-
Many researchers are interested in the transcription of protein-encoding genes in eukaryotes. Such researchers want to study mRNA. One method that is used to isolate mRNA is column chromatography....
-
In the last session, you used data and process modeling techniques to develop a logical model of the new system. Now you will apply your object modeling skills to create various diagrams and...
-
What do you mean by Hardware Software Interface? Give a concrete example. Define the two principle integrity rules for the relational model. Discuss why it is desirable to enforce these rules.
-
Dippin Donuts has six bakers and a bakery supervisor on each of its two shifts. Bakers working from 8am 5pm (with a 1-hour break) are paid $6.00 per hour. Bakers working the 10pm-7am shift (with a...
-
8. Which statement regarding stagnation is TRUE? * (1 Point) It is a period of selflessness It is when a person has met their personal goals It is the feeling of having very little to offer the next...
-
What is the difference between structuralism and functionalism in psychology?
-
What are some examples of a multiple relationship in psychology?
-
2 . What are the basic differences between macrosociology and microsociology? Give specific, practical examples of each. Which one lends itself to each of the four orienting strategies discussed in...
-
explain memory retrieval in psychology and its components.
-
in psychology what is the difference between perception, judging, and seeing? and give an example
-
Find the inverse Laplace transform of the given function. (Express your answer in terms of t.) 16 (s - 3) {F(s)} = 4ecos (21) F(s) = X
-
$10,000 was borrowed at 3.5% on July 17. The borrower repaid $5000 on August 12, and $2000 on September 18. What final payment is required on November 12 to fully repay the loan?
-
SkiBlu, Ltd., divides its customers into Gold customers and Silver customers. The company has one full-time customer representative per 1,000 Gold customers and one full-time customer representative...
-
Farmington Components has two production departments (Fabrication and Assembly) and three service departments (Engineering, Administration, and Maintenance). During July, the following costs and...
-
Refer to the data in Exercise 8-29. Compute the costs of goods transferred out and the ending inventory using the weighted-average method.
-
An engineering organisational system is composed of major groups such as management, research and development, preliminary design, experiments, product design and drafting, fabrication and...
-
The student-teacher learning activity is inherently a feedback exercise intended to reduce the system error to a minimum. The desired output is the knowledge being studied, and the student is the...
-
Give two examples of feedback control systems in which a human acts as a controller.
Study smarter with the SolutionInn App