Selling price Variable costs: Direct materials Direct labour Variable manufacturing overhead Total variable cost Contribution margin...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Selling price Variable costs: Direct materials Direct labour Variable manufacturing overhead Total variable cost Contribution margin Contribution margin ratio Contribution margin per labour hour O Product A O Product B O Product C A $150.00 A 73.50 18.00 4.50 96.00 $ 54.00 36% Due to a strike in the plant of one of its competitors, demand for the company's products far exceeds its capacity to produce. Management is trying to determine which product(s) to concentrate on next week in filling its backlog of orders. The direct labour rate is $9 per hour, and only 3,920 hours of labour time are available each week. Maximum amount Required: 1. Compute the amount of contribution margin that will be obtained per hour of labour time spent on each product. (Round your intermediate calculations to 1 decimal place. Round your answers to 2 decimal places.) Product B $150.00 per hour 45.00 36.00 9.00 90.00 $60.00 40% B C $130.00 73.70 18.00 4.50 96.20 $ 33.80 26% с 2. Which orders would you recommend that the company work on next week-the orders for product A, product B, or product C? 3. By paying overtime wages, more than 3,920 hours of direct labour time can be made available next week. Up to how much should the company be willing to pay per hour in overtime wages as long as there is unfilled demand for the three products? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Selling price Variable costs: Direct materials Direct labour Variable manufacturing overhead Total variable cost Contribution margin Contribution margin ratio Contribution margin per labour hour O Product A O Product B O Product C A $150.00 A 73.50 18.00 4.50 96.00 $ 54.00 36% Due to a strike in the plant of one of its competitors, demand for the company's products far exceeds its capacity to produce. Management is trying to determine which product(s) to concentrate on next week in filling its backlog of orders. The direct labour rate is $9 per hour, and only 3,920 hours of labour time are available each week. Maximum amount Required: 1. Compute the amount of contribution margin that will be obtained per hour of labour time spent on each product. (Round your intermediate calculations to 1 decimal place. Round your answers to 2 decimal places.) Product B $150.00 per hour 45.00 36.00 9.00 90.00 $60.00 40% B C $130.00 73.70 18.00 4.50 96.20 $ 33.80 26% с 2. Which orders would you recommend that the company work on next week-the orders for product A, product B, or product C? 3. By paying overtime wages, more than 3,920 hours of direct labour time can be made available next week. Up to how much should the company be willing to pay per hour in overtime wages as long as there is unfilled demand for the three products? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Expert Answer:
Answer rating: 100% (QA)
Question Part 1 contribution margin No of direct labour ho... View the full answer
Related Book For
Practical Management Science
ISBN: 978-1305250901
5th edition
Authors: Wayne L. Winston, Christian Albright
Posted Date:
Students also viewed these general management questions
-
A bank is trying to determine which of two machines to rent for check processing. Machine 1 rents for $10,000 per year and processes 1000 checks per hour. Machine 2 rents for $15,000 per year and...
-
Top management is trying to determine a consistent but fair valuation system to use to evaluate each of its four divisions. This years performance data are summarized as follows: Required A. Which...
-
Noble Amazon sells books online. Management is trying to determine the best sites for the company's warehouses. The five potential sites under consideration are listed in the first column of the...
-
Methanol, CH3OH, is prepared industrially from the gasphase catalytic balanced reaction that has been depicted here using molecular models. In a laboratory test, a reaction vessel was filled with...
-
Consider the following bond: Coupon rate = 11% Maturity = 18 years Par value = $1,000 First par call in 13 years Only put date in five years and putable at par value Suppose that the market price for...
-
Explain what is meant by extra-sensory perception.
-
In 2016, Beta Company purchased the working interest of an unproved lease for \($50,000\). In 2017, Beta Company recognized impairment of \($20,000\) on this lease. In 2018, Beta Company sold the...
-
New Energy is evaluating a new biofuel facility. The plant would cost $4,000 million to build and has the potential to produce up to 40 million barrels of synthetic oil a year. The product is a close...
-
On the interval shown, for which graph is f negative, f' negative and f" zero? OA. E OB. Q G O C. Q E D. OE. Q G E
-
A randomized controlled trial comparing two drugs for treating insomnia is said to have 85% power to detect a 20% relative reduction (RR=0.80) in sleep problems nine months following treatment at the...
-
ences Required information [The following information applies to the questions displayed below.) Kitty Company began operations in the current year and acquired short-term debt investments in trading...
-
What questions should be asked by an auditor in determining the appropriate opinion to express?
-
Indicate the opinions that may be expressed for (a) a scope limitation (b) nonconformity with GAAP.
-
a. Explain the circumstance and the effects on the auditor's report when nonconformity with a promulgated principle results in an unqualified opinion. b. Contrast the effects on the auditor's report...
-
a. What pronouncements are recognized as promulgated accounting principles? b. Must a company always comply with promulgated accounting principles under Ethics Rule 203?
-
Distinguish between the levels of assurance that may be given when (a) auditing and (b) applying agreed-upon procedures to specified elements, accounts, or items of a financial statement.
-
You are the senior on the audit of Smartpart (Pty) Ltd, a company which wholesales a large range of motor vehicle accessories to garages, panel beating businesses and specialist accessory shops. The...
-
Danielle has an insurance policy with a premium of $75 per month. In September she is in an accident and receives a bill worth $2990 for the repair of her own property. Her deductible is $250 and her...
-
Repeat the previous problem, but make the correlation between the two inputs equal to 0.7. Explain how the results change. Data from Previous Problem: When you use @RISKs correlation feature to...
-
Based on Grossman and Hart (1983). A salesperson for Fuller Brush has three options: (1) quit, (2) put forth a low level of effort, or (3) put forth a high level of effort. Suppose for simplicity...
-
If a monopolist produces qunits, she can charge 400 4q dollars per unit. The variable cost is $60 per unit. a. How can the monopolist maximize her profit? b. If the monopolist must pay a sales tax...
-
Leeds Architectural Consultants began operations on January 2. The following activity was recorded in the company's Work in Process account for the first month of operations: Leeds Architectural...
-
Estimated cost and operating data for three companies for the upcoming year follow: Predetermined overhead rates are computed using the following bases in the three companies: Required: 1. Compute...
-
Dillon Products manufactures various machined parts to customer specifications. The company uses a job-order costing system and applies overhead cost to jobs on the basis of machine-hours. At the...
Study smarter with the SolutionInn App