Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Hi Please, Provide solution of both questions. then i will rate. 11 Edge Company produces two models of its product with the same machine. The

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed

Hi Please, Provide solution of both questions. then i will rate.

11 Edge Company produces two models of its product with the same machine. The machine has a capacity of 148 hours per month. The following information is available. 2 points Selling price per unit Variable costs per unit Contribution margin per unit Machine hours per unit Maximum unit sales per month Standard $ 110 49 $ 70 Deluxe $ 140 84 $ 56 eBook 1 hour 500 units 2 hours 250 units Print Required: References 1. Determine the contribution margin per machine hour for each model. Product Contribution Margin Contribution margin per unit Standard Deluxe Contribution margin per machine hour 2. How many units of each model should the company produce? How much total contribution margin does this mix produce per month? Standard Deluxe Total Hours dedicated to the production of each product Units produced for most profitable sales mix Contribution margin per unit Total contribution margin 3. Assume the maximum demand for the Standard model is 70 units (not 500 units). How many units of each model should the company produce? How much total contribution margin does this mix produce per month? Standard Deluxe Total Hours dedicated to the production of each product Units produced for most profitable sales mix Contribution margin per unit Total contribution margin 12 JART manufactures and sells underwater markers. Its contribution margin income statement follows. 2 points Annual Total $ 3,080,000 eBook Contribution Margin Income Statement For Year Ended December 31 Per Unit Sales (440,000 units) $ 7.00 Variable costs Direct materials 1.48 Direct labor 0.52 Variable overhead 0.70 Contribution margin 4.30 Fixed costs Fixed overhead 0.30 Fixed general and administrative 0.25 Income $ 3.75 651,200 228,800 308,000 1,892,000 Print References 132,000 110,000 $ 1,650,000 A potential customer offers to buy 54,000 units for $3.70 each. These sales would not affect the company's sales through its normal channels. Details about the special offer follow. Direct materials cost per unit and variable overhead cost per unit would not change. Direct labor cost per unit would be $0.65 because the offer would require overtime pay. Accepting the offer would require incremental fixed general and administrative costs of $5,400. Accepting the offer would require no incremental fixed overhead costs. Required: 1. Compute income from the special offer. 2. Should the company accept or reject the special offer? Required 1 Required 2 Compute income from the special offer. (Round your "Per Unit" answers to 2 decimal places.) Special Offer Analysis Per Unit Total Contribution margin Fixed overhead Fixed general and administrative Income (loss)

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

College Accounting Chapters 1-13

Authors: John Price, M. David Haddock, Michael Farina

15th Edition

125999516X, 9781259995163

Students also viewed these Accounting questions