Answered step by step
Verified Expert Solution
Question
1 Approved Answer
In response to a growing awareness of gluten allergies, Sunland Bakery tried using gluten-free flour in its three most popular cookies. After several attempts and
In response to a growing awareness of gluten allergies, Sunland Bakery tried using gluten-free flour in its three most popular cookies. After several attempts and a lot of inedible cookies, the company perfected new recipes that yield delicious gluten-free cookies. The costs of producing a batch of 100 cookies are as follows: Chocolate Chip Sugar Oatmeal Raisin Sales price $130 $117 $122 Variable cost $75 $70 $70 Fixed cost Total cost Grass profit *|*|*| 16 86 20 ** 90 $31 $32 Pounds of flour 2.5 25 (a) Assuming no raw material constraints and unlimited demand for cookies, calculate contribution margin per batch for Chocolate Chip, Sugar, Oatmeal Raisin cookies. (Round answers to 2 decimal places, e.g. 52.75.) Cookies Contribution Margin $ Chocolate Chip $ Sugar $ Oatmeal Raisin What type of cookie would maximize the company's contribution margin? eTextbook and Medla Assume that, based on typical customer demand, Sunland will sell 11,500 batches of chocolate chip cookies, 7,500 batches of sugar cookies, and 9,500 batches of oatmeal raisin cookies. What will the company's contribution margin be? (c) The company's contribution margin $ eTextbook and Medla Save for Later Attempts: 0 of 3 used Submit Answer Sunland's flour supplier has announced a shortage of gluten-free flour. As a result, Sunland will only be able to purchase 47,750 pounds of flour. How many batches of each type of cookie should the company bake? Chocolate Chip Sugar Oatmeal Raisin Batches What will the company's contribution margin be? (d) S The company's contribution margin eTextbook and Medla Save for Later Attempts: 0 of 3 used Submit Answer If Sunland uses gluten-free flour in other products, will the allocation you recommend in part (c) change
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started