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ACC3300-Fall 2017-Chapter 3 A-Lot-A Funw SHOW ALL WORK AND BOX OR CIRCLE YOUR FINAL ANSWERS! Round all final answers to 2 decimal places, if applicable. produces and sells some tasty TV dinners (Meatloaf, Crab Cake, and a Hot Dog Exercise 1) Meal). Last year, WhatchaEatin sold 7,275 Meatloaf Meals, 2,425 Crab Cake Meals, and 12,125 Hot Dog Meals. Fixed costs during the last year were $21,050. Information on the two products is as follows: Meatloaf Meal S5.40 5596 Crab Cake Meal $7.60 65% Hot Dog Meal Sales Price Variable Cost Ratio $4.70 30% Some of the employees at WhatchaEatin' came up with a great idea to add a Veggie Burger Meal & a Fish Stick Meal!! The company estimates that 9,700 Veggie Burger Meals can be sold at a price of $6.55 and a variable cost per unit of $2.23. The company estimates that 14,550 Fish Stick Meals can be sold at a price of $5.15 and a variable cost per unit of $3.07. Fixed cost will be increased by $4,252 due to the addition of the Veggie Burger Meal and by $6,990 for the addition of the Fish Stick Meal. Assume that anticipated sales of other products, as well as their prices and variable costs, will remain the same. Required 1. What is the sales mix of Meatloaf, Crab Cake, Hot Dog, Veggie Burger, and Fish Stick Meals? 2. Compute the break-even quantity of each product assuming the same sales mix. 3. Prepare a contribution margin operating income statement for WhatchaEatin' for the coming year. 4. What is the overall contribution margin ratio? 5. What is the margin of safety for the coming year in sales dollars? 6. By how much is WhatchaEatin' better or worse off with the addition of these two tasty mcals? Exercise 2) Yummy Inc. produces a tasty fudge treat. Each 14-ounce box sells for $11.99. Variable unit costs are as follows: Sugar Butter Other ingredients Boxes & packing Selling commission $0.87 2.98 1.36 2.11 Fixed overhead cost is $97,150 per year. Fixed selling and administrative costs are $22,333 per year. Yummy sold 43,210 boxes of fudge last year eguired 1. 2. 3. 4. What is the contribution margin ratio for a box of fudge? Prepare a contribution margin operating income statement for Yummy How many boxes must be sold to break even? What is the margin of safety in dollars? that Yummy Inc, raises the price to $13.99 per box but anticipates sales to drop by 12,345 boxes. What will the new break-even point in units be? Should Yummy raise the price and how would you explain your answer to the CEO and CFO of Yummy, Inc? 6