Barrios and an older plant in Asc. The following data are available for the two plants. Home Insert Page Layout A 1 2 Selling price 3 Variable manufacturing cost per unit 4 Fixed manufacturing cost per unit 5 Variable marketing cost per unit 6 Fixed marketing cost per unit 7 Total cost per unit 8 Operating income per unit 9 Production rate per day 10 Normal annual capacity usage 11 Maximum annual capacity Formulas Data B C Los Barrios $80.00 35.00 20.00 30.00 Review $200.00 500 units 240 days 300 days View 165.00 $ 35.00 D Asc $85.00 27.00 25.00 24.00 With the machine? b. What is the BEP if the machine is rented? c. What do you notice about the figures that you calculate? E $200.00 161.00 $39.00 400 units 240 days 300 days All fixed costs per unit are calculated based on a normal capacity usage consisting of 240 working days. When the number of working days exceeds 240, overtime charges raise the variable manufacturing costs of additional units by $5.00 per unit in Los Barrios and $10.00 per unit in Asc. Salamanca Corporation is expected to produce and sell 240,000 power generators during the coming year. Wanting to take advantage of the higher operating income per unit at Asc, the company's production manager has decided to manufacture 120,000 units at each plant, resulting in a plan in which Asc operates at maximum capacity (400 units per day 300 days) and Los Barrios operates at its normal volume (500 units per day 240 days). Required: a. Calculate the breakeven point in units for the Los Barrios plant and for the Asc plant. b. Calculate the operating income that would result from the production manager's plan to produce 120,000 units at each plant. c. Determine how the production of 240,000 units should be allocated between the Los Barrios and Asc plants to maximize operating income for Salamanca Corporation. Show your calculations. a. How much profit would the business make each month from selling baskets: Without the machine; and 2) Cottage Industries Ltd makes baskets. The fixed cost of operating the workshop for a month totals 500. Each basket requires materials that cost 2 and takes one hour to make. The business pays the basket makers 10 an hour. The basket makers are all on contracts such that if they do not work for any reason, they are not paid. The baskets are sold to a wholesaler for 14 each. What is the BEP for basket making for the business? Cottage Industries Ltd expects to sell 500 baskets a month. The business has the opportunity to rent a basket making machine. Doing so would increase the total fixed cost of operating the workshop for a month to 3.000. Using the machine would reduce the labor time to half an hour per basket. The basket makers would still be paid 10 an hour.

Barrios and an older plant in Asco. The following data are available for the two plants. All fixed costs per unit are calculated based on a normal capacity usage consisting of 240 working days. When the number of working days exceeds 240 , overtime charges raise the variable manufacturing costs of additional units by $5.00 per unit in Los Barrios and $10.00 per unit in Asc. Salamanca Corporation is expected to produce and sell 240,000 power generators during the coming year. Wanting to take advantage of the higher operating income per unit at Asco, the company's production manager has decided to manufacture 120,000 units at each plant, resulting in a plan in which Asco operates at maximum capacity ( 400 units per day 300 days) and Los Barrios operates at its normal volume ( 500 units per day 240 days). Required: a. Calculate the breakeven point in units for the Los Barrios plant and for the Ase plant. b. Calculate the operating income that would result from the production manager's plan to produce 120,000 units at each plant. c. Determine how the production of 240,000 units should be allocated between the Los Barrios and Asc plants to maximize operating income for Salamanca Corporation. Show your calculations. 2) Cottage Industries Ltd makes baskets. The fixed cost of operating the workshop for a month totals 500. Each basket requires materials that cost f2 and takes one hour to make. The business pays the basket makers 10 an hour. The basket makers are all on contracts such that if they do not work for any reason, they are not paid. The baskets are sold to a wholesaler for fl/4 each. What is the BEP for basket making for the business? Cottage Industries Ltd expects to sell 500 baskets a month. The business has the opportunity to rent a basket making machine. Doing so would increase the total fixed cost of operating the workshop for a month to f3.000. Using the machine would reduce the labor time to half an hour per basket. The basket makers would still be paid f10 an hour. a. How much profit would the business make each month from selling baskets: - Without the machine; and