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I need help with how to figure out the Sales, Variable Costs of Goods sold, Manufacturing Margin, Variable Selling Expenses, Contribution Margin , and Contribution
I need help with how to figure out the Sales, Variable Costs of Goods sold, Manufacturing Margin, Variable Selling Expenses, Contribution Margin , and Contribution Margin Ratio:
Product Profitability Analysis Galaxy Sports Inc. manufactures and sells two styles of All Terrain Vehicles (ATVs), the Conquistador and Hurricane, from a single manufacturing facility. The manufacturing facility operates at 100% of capacity. The following per-unit information is available for the two products: Conquistador Hurricane Sales price $6,800 $4,000 Variable cost of goods sold (4,280) (2,680) Manufacturing margin $2,520 $1,320 Variable selling expenses (1,092) (600) Contribution margin $1,428 $720 Fixed expenses (670) (290) Operating income $755 $430 In addition, the following sales unit volume information for the period is as follows: Conquistador Hurricane Sales unit volume 2,600 1,900 a. Prepare a contribution margin by product report. Compute the contribution margin ratio for each product as a whole percent. Galaxy Sports Inc. Contribution Margin by Product a. Prepare a contribution margin by product report. Compute the contribution margin ratio for each product as a whole percent. Galaxy Sports Inc. Contribution Margin by Product Conquistador Hurricane Sales Variable cost of goods sold Manufacturing margin Variable selling expenses Contribution margin Contribution margin ratio 21 % b. What advice would you give to the management of Galaxy Sports Inc. regarding the profitability of the two products? The Conquistador V line provides the largest total contribution margin and the largest contribution margin ratio. If the sales mix were shifted more toward the Conquistador V line, the overall profitability of the company would increaseStep by Step Solution
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