Hello, here is my problem and I found the step by step instructions on Chegg:

Vorma manufactures two proprietary all-natural fruit antioxidant food additives that are approved by the US Food and Drug Administration. One is for liquid vitamins (LiqVita) and the other is used by dry cereal producers (Dry). Both of these products are sold only in the US and although they both share common chemistry and manufacturing, their end markets are completely separated. Both are produced in the same plant and share common manufacturing processes, such as purchasing, quality control, human resources, and so forth. These common fixed overhead costs amount to $1,500,000 per month. Each product also has its won directly traceable fixed costs, such as dedicated equipment leases used only by one of the two products, dedicated product engineers, and so forth. The following table summarizes the operations of Vorma for a typical month. Please see the table below.

Here are the questions, which I have walked through on Chegg and my answers are below. It is questions G and F that I am needing some assistance on please.

A) Prepare a typical monthly income statement for LiqVia and Dry after allocating the common fixed overhead costs of $1,500,000 per month to the two product lines based on the relative proportions of total variable costs generated by each product.

B) Which of the two products in part (A) is the most profitable and which is the least profitable? Note: you are not being asked to analye or explain the relative profitabilites of LiqVita and Dry.

C) Vorma is planning to introduce a tablet version of its vitamin into China, with a selling price of $9 and a variable cost of $7. At a price of $9, Vorma managers believe they will sell 950,000 units per month in China. Introducing the new product (called China) will require additional "own fixed costs" (just for China) of $800,000. As in part (A) prepare monthly income statements, computing the monthly net income for the three products (LiqVia, Dry and China). Allocate the common fixed overhead of $1,500,000 based on the relative proportions of total variable costs generated be each product.

D) As in part (B) list the order of the most profitable to least profitable products. Do not do an analysis.

E) Compare the realative profitability of the two products (LiqVita and Dry) before introducing China (part B) and after introducing China (part D). Analyze and discuss why the relative profitability of the two preexisting products (LiqVita and Dry) does or does not change with the introduction of the new product (China).

F) Is Vorma better off after adding China? If so, why? If not, why not?

G) What other allocation method (rather than based on the proportion of total variable costs) might Vorma consider using to allocate fixed overhead costs? Why might this be better?

Vorma
	LiqVita	Dry
Units	200,000	75,000
Price Per Unit	$10	$21
Variable Cost Per Unit	$6	$11
Own Fixed Costs Per Month	$90,000	$110,000

A) Prepare a typical monthly income statement for LiqVita and Dry after allocating the common fixed overhead costs of $1,500,000 per month to the two product lines based on the relative proportions of total variable costs generated by each product.
	LiqVita	Dry	Total
Revenue	$2,000,000	$1,575,000	$3,575,000
Variable Cost	1,200,000	825,000	2,025,000
Own Fixed Cost	90,000	110,000	200,000
Allocated Overhead	888,889	611,111	1,500,000.00
Net Income (loss)	($178,889)	$28,889	($150,000)
%Variable Cost	59%	41%
B) Which of the two products in part (A) is the most profitable and which is the least profitable? Note: you are not being asked to analyze or explain the relative profitabilities of LiqVita and Dry.
LiqVita is the least profitable of the two due to a $178,889 loss and Dry made $28,889 profit.
C) Vorma is planning to introduce a table version of its vitamin into China, with a selling price of $9.00 and a variable cost per unit of $7.00. At a price of $9.00, Vorma managers believe they will sell 950,000 units per month in China. Introducing the new product (called China) will require additional "Own fixed costs" (just for China) of $800,000. As in part (A) prepare monthly income statements, computing the monthly net income for the three products (LiqVita, Dry and China). Allocate the common fixed overhead of $1,500,000.00 based on the relative proportions of total variable costs generated by each product.
	China
Units	950,000
Price Per Unit	$ 9.00
Variable Cost Per Unit	$ 7.00
Own Fixed Costs Per Month	$ 800,000.00
	LiqVita	Dry	China	Total
Revenue	$2,000,000	$1,575,000	$ 8,550,000.00	$12,125,000
Variable Cost	1,200,000	825,000	$ 6,650,000.00	8,675,000
Own Fixed Cost	90,000	110,000	$ 800,000.00	1,000,000
Allocated Overhead	207,493	142,651	1,149,856	1,500,000.00
Net Income (loss)	$502,507	$497,349	$ (49,855.91)	$950,000
%Variable Cost	14%	10%	77%
D) As in part (B), list the order of the most profitable products. Do not do any analysis.
LiqVita, Dry and then China.
E) Compare the relative profitability of the two products (LiqVita and Dry) before introducing China (part B) and after introducing China (part D). Analyze and discuss why the relative profitability of the two preexisting products (LiqVita and Dry) does or does not change with the introduction of the new product China.
Before China was introduced Dry was the more profitable of the two products. When you add cost allocations into a situation profitability of a product can be altered. When we added China, LiqVita became much more profitable which is interesting because none of LiqVita or Dry's data changed, but yet LiqVita is outdoing Dry now. I believe China is suffering the worst due to the cost allocations being so heavy on it over the other 2. If you look at LiqVita and Dry before adding China, LiqVita had the heavier of the two on cost allocations and it to suffered a loss. You can see the % changes in the variable costs. Before China, LiqVita was at 59% and Dry at 41%, when you add China you see the % change goes from LiqVita at 14%, Dry 10% and China is 77%.
F) Is Vorma better off after adding China? If so, why? If not, why not?
I believe Vorma is still better off after adding China because of the profit margins. When it was just LiqVita and Dry, Vorma was losing profit by 150,000. Even though they lost $50k adding China, there overall profit is now at 950,000 which is $800,000 increase in the profit.
	LiqVita	Dry	Total			LiqVita	Dry	China	Total
Revenue	$ 2,000,000.00	$ 1,575,000.00	$ 3,575,000.00		Revenue	$2,000,000	$1,575,000	$ 8,550,000.00	$12,125,000
Variable Cost	1,200,000	825,000	2,025,000		Variable Cost	1,200,000	825,000	$ 6,650,000.00	8,675,000
Own Fixed Cost	90,000	110,000	200,000		Own Fixed Cost	90,000	110,000	$ 800,000.00	1,000,000
Allocated Overhead	888,889	611,111	1,500,000		Allocated Overhead	207,493	142,651	1,149,856	1,500,000.00
Net Income (loss)	$ (178,888.89)	$ 28,888.89	$ (150,000.00)		Net Income (loss)	$502,507	$497,349	$ (49,855.91)	$950,000
%Variable Cost	59%	41%			%Variable Cost	14%	10%	77%