Hey, I mainly need help with the bottom portion I have solved the rest of the Problem. Thanks, so much in Advance.
Territory and product profitability analysis Instructions Amount Descriptions Instructions Coast to Coast Surfboards Inc. manufactures and sells two styles of surfboards, Atlantic Wave and Pacific Pounder. These surfboards are sold in two regions, East Coast and West Coast. Information about the two surfboards is as follows: Atlantic Wave Pacific Pounder Sales price $336.00 $136.00 Variable cost of goods sold per unit 126.00 51.00 Manufacturing margin per unit $210.00 $85.00 180.00 68.00 Variable selling expense per unit Contribution margin per unit $30.00 $17.00 The sales unit volume for the sales territories and products for the period is as follows: West Coast Atlantic Wave East Coast 20,000 0 5,000 5,000 Pacific Pounder a. Prepare a contribution margin by sales territory report. Calculate the contribution margin ratio for each territory as a whole percent, rounded to one decimal place. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. b. What advice would you give to the management of Coast to Coast Surfboards regarding the relative profitability of the two territories? Contribution Margin Report Shaded cells have feedback. a. Prepare a contribution margin by sales territory report. Calculate the contribution margin ratio for each territory as a whole percent, rounded to one decimal place. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. Coast to Coast Surfboards Inc. Score: 74/74 Contribution Margin by Territory East Coast West Coast Sales 3 Variable cost of goods sold Manufacturing margin $6,720,000.00 2,520,000.00 $4,200,000.00 3,600,000.00 $600,000.00 8.9% $2,360,000.00 885,000.00 $1,475,000.00 1,240,000.00 $235,000.00 10.0% Variable selling expenses Contribution margin Contribution margin ratio Points: 18/18 Feedback Check My Work To recast the contribution margin data by sales territory report, multiply the sales volume by each per-unit amount. To calculate the contribution margin ratio, divide the contribution margin by sales. Final Question Shaded cells have feedback. b. What advice would you give to the management of Coast to Coast Surfboards regarding the relative profitability of the two territories? The East Coast's total contribution margin is higher and the contribution margin ratio is lower when compared to the West Coast. This, in part, is explained by the single board style for the East Coast as compared to the two styles available in the West Coast. Taking a closer look, the Atlantic Wave's manufacturing margin/unit is $ while the Pacific Pounder's is $ unit. And the Atlantic Wave's variable selling expense/unit is $ while the Pacific Pounder's is S u nit. Points: 2/6 With an eye on improving profitability, modifying the product mix within the two territories would be ineffective Additionally, the company should review variable costs The variable cost of goods sold V could shed light on manufacturing inefficiencies. Also, a review of Atlantic Wave's variable selling expense per unit could also help with overall profitability. Points: 4/4
