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Edgerron Company is able to produce two products, G and B, with the same machine in its factory. The following information is available. Product G

Edgerron Company is able to produce two products, G and B, with the same machine in its factory. The following information is available.

Product G Product B
Selling price per unit $ 150 $ 180
Variable costs per unit 60 108

Contribution margin per unit $ 90 $ 72

Machine hours to produce 1 unit 0.4 hours 1.0 hours
Maximum unit sales per month 550 units 200 units

The company presently operates the machine for a single eight-hour shift for 22 working days each month. Management is thinking about operating the machine for two shifts, which will increase its productivity by another eight hours per day for 22 days per month. This change would require $9,000 additional fixed costs per month. (Round hours per unit answers to 1 decimal place. Enter operating losses, if any, as negative values.)

1. Determine the contribution margin per machine hour that each product generates.
Product G Product B
Contribution margin per unit $90.00 $72.00
Machine hours per unit 0.4 1.0
Contribution margin per machine hour $225.00 $72.00
Product G Product B Total
Maximum number of units to be sold 550 200
Hours required to produce maximum units 220 200 420
2. How many units of Product G and Product B should the company produce if it continues to operate with only one shift? How much total contribution margin does this mix produce each month?
Product G Product B Total
Hours dedicated to the production of each product 176 0 176
Units produced for most profitable sales mix 440 ?
Contribution margin per unit $90.00 ?
Total contribution margin - one shift $39,600 ?
3. If the company adds another shift, how many units of Product G and Product B should it produce? How much total contribution margin would this mix produce each month?
Product G Product B Total
Hours dedicated to the production of each product 220 132 352
Units produced for most profitable sales mix 550 132
Contribution margin per unit $90.00 $72.00
Total contribution margin - two shifts $49,500 $9,504 $59,004
Total contribution margin - one shift
?
?
?
Yes
4. Suppose that the company determines that it can increase Product Gs maximum sales to 600 units per month by spending $8000 per month in marketing efforts. Should the company pursue this strategy and the double shift?
Product G Product B Total
Hours dedicated to the production of each product 240 112 352
Units produced for most profitable sales mix 600 112
Contribution margin per unit $90.00 $72.00
Total contribution margin - two shifts and marketing campaign $54,000 $8,064 $62,064
Contribution margin - two shifts without marketing campaign 59,004
Change in contribution margin ?
?
?
?
No

AS YOU CAN SEE HALF OF THE QUESTION HAS BEEN ANSWERED. BUT I STILL NEED ANSWER TO THE REST OF THE BLANKS. THANKS

(ALL THE OTHER NUMBERS I HAVE HERE IS CORRECT. I AM ABLE TO CHECK IN THE SYSTEM. PLEASE GIVE ME CORRECT ANSWERS FOR THE BLANKS.)

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