Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Assume that MTA Sandwiches sells sandwiches for $3.50 each. The cost of each sandwich follows. Materials Labor Variable overhead Fixed overhead ($27,000 per month, 21,600

image text in transcribed
image text in transcribed
Assume that MTA Sandwiches sells sandwiches for $3.50 each. The cost of each sandwich follows. Materials Labor Variable overhead Fixed overhead ($27,000 per month, 21,600 units per month) Total costs per sandwich $0.80 0.40 0.50 1.25 $2.95 One of MTA's regular customers asked the company to fill a special order of sandwiches at a selling price of $2.25 each for a fund- raising event sponsored by a social club at the local college, MTA has capacity to fill it without affecting total fixed costs for the month, MTA's general manager was concerned about selling the sandwiches below the cost of $2.95 and has asked for your advice. Required: a. Prepare a schedule to show the impact on MTA's profits of providing 400 sandwiches in addition to the regular production and sales of 21,600 sandwiches per month. b. Based solely on the data given what is the lowest price per saridwich at which the special order can be filled without reducing MTA's profits? Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule to show the impact on MTA's profits of providing 400 sandwiches in addition to the regular production and sales of 21,600 sandwiches per month. (Select option "higher" or "lower, keeping Status Quo as the base. Select "none" it there is no effect.) b. Based solely on the data given, what is the lowest price per sandwich at which the special order can be filled without reducing MTA's profits? Complete this question by entering your answers in the tabs below. Required A Required B Prepare a schedule to show the impact on MTA's profits of providing 400 sandwiches in addition to the regular production and sales of 21,600 sandwiches per month. (Select option "higheror "lower", keeping Status Quo as the base. Select "none" ir there is no effect.) Status Quo 21,600 Units Alternative 22,000 Units Difference Sales revenue Less variable costs Materials Labor Variable overhead Total variable cost Contribution margin Less: Fixed costs Operating profit $ 0 $ 0 $ Required Required B >

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction To AccountingAn Integrated Approach

Authors: Penne Ainsworth, Dan Deines

8th Edition

1119600103, 9781119600107

More Books

Students also viewed these Accounting questions

Question

Understand the role of employer branding in talent management.

Answered: 1 week ago