Answered step by step
Verified Expert Solution
Link Copied!
Question
1 Approved Answer

Bright Day Company produces two beverages, Hi-Voltage and EasySlim. Data about these products follow. Hi-Voltage EasySlim Production volume 10,500 bottles 230,000 bottles Liquid materials 1,000

Bright Day Company produces two beverages, Hi-Voltage and EasySlim. Data about these products follow.

Hi-Voltage EasySlim
Production volume 10,500 bottles 230,000 bottles
Liquid materials 1,000 gallons 29,000 gallons
Dry materials 720 pounds 13,000 pounds
Bottles 10,500 bottles 230,000 bottles
Labels 4 labels per bottle 2 label(s) per bottle
Machine setups 800 setups 600 setups
Machine hours 200 MH 3,900 MH

Additional data from its two production departments follow.

Department Driver Cost
Mixing department
Liquid materials Gallons $ 1,800
Dry materials Pounds 8,918
Utilities Machine hours 1,640
Bottling department
Bottles Units $ 96,200
Labeling Labels per bottle 25,100
Machine setup Setups 35,000

Required: 1 & 2. Determine the cost of each product line using ABC. What is the cost per bottle for Hi-Voltage and EasySlim? 3. If Hi-Voltage sells for $6.25 per bottle, how much profit does the company earn per bottle of Hi-Voltage that it sells? 4. What is the minimum price that the company should set per bottle of EasySlim?

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

Internal Auditing And Risk Management The Mediating Effect Of Role Ambiguity On Factors Performance Relationship

Authors: Shabnam Fazli Aghghaleh, Zakiah Mohammadun Mohammed, Azlina Ahmad

1st Edition

3846587397, 978-3846587393

More Books

Students explore these related Accounting questions