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Bill Johnson, sales manager, and Diane Buswell, controller, at Current Designs are beginning to analyze the cost considerations for one of the composite models of
Bill Johnson, sales manager, and Diane Buswell, controller, at Current Designs are beginning to analyze the cost considerations for one of the composite models of the kayak division. They have provided the following production and operational costs necessary to produce one composite kayak. Kevlar $300 per kayak Resin and supplies .$130 per kayak Finishing kit (seat, rudder ropes, etc.) $170 per kayak Direct Labor - $420 per kayak Selling and administrative expenses ---variable $420 per kayak Selling and administrative expenses--fixed $156,000 per year Manufacturing overhead-fixed $240.000 per year Bill and Diane have asked you to provide a cost-volume-profit analysis to help them finalize the budget projections for the upcoming Year, Bill has informed you that the selling price of the composite kayak will be $2.100.
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