Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Current Designs manutactures two ditferent types of kayaks, rotomolded kayaks and composite kayaks The following information is N vailable for each product line. The company's

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Current Designs manutactures two ditferent types of kayaks, rotomolded kayaks and composite kayaks The following information is N vailable for each product line. The company's fixed costs are $735,000, An analysis of the sales mix identifes that rotomolded kayaks make up 80% of the total units sold. (a) Determine the welghted average unit contribution margin tor Current Designs. Weighted-average unit contribution marsin \$ Determine the break-even point in sales units for Current Designs and identify how many units of each type of kayak will be sold at the break-even point. Break-even sales units Assume that the sales mix changes, and rotomolded kayaks now make up 70% of total units sold. Calculate the total number of units that would need to be sold to earna net income of $1,798,500 and identify how many units of each type of kayak will be sold at this level of income. Required sales units Assume that Current Designs will have sales of $2,700,000 with two-thirds of the sales dollars in rotomolded kayaks and onethird of the sales dollars in composite kayaks. Assuming $594,000 of fixed costs are allocated to the rotomolded kayaks and $141,000 to the composite kayaks, prepare a CVP income statement for each product ine. Calculate the degree of operating leverage foreach product line. (found answers to 2 decimal places es, 5275 .)

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

Step: 3

blur-text-image

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

Auditing Processing Learn About Types Of Audits For Auditors Auditing For Dummies

Authors: Mazie Dannenberg

1st Edition

B097DGKYS7, 979-8524930576

More Books

Students also viewed these Accounting questions

Question

Compare levels of resolution in conflict outcomes?

Answered: 1 week ago

Question

Strategies for Managing Conflict Conflict Outcomes?

Answered: 1 week ago