Question
In response to a growing awareness of gluten allergies, Wildhorse 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, Wildhorse 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 | $127.60 | $109.80 | $130.20 | |||||||||
| Variable cost | $78 | $61 | $87 | |||||||||
| Fixed cost | 18 | 13 | 21 | |||||||||
| Total cost | 96.00 | 74.00 | 108.00 | |||||||||
| Gross profit | $31.60 | $35.80 | $22.20 | |||||||||
| Pounds of flour | 2 | 2 | 1.5 | |||||||||
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 | $Enter a dollar amount rounded to 2 decimal places | |
| Sugar | $Enter a dollar amount rounded to 2 decimal places | |
| Oatmeal Raisin | $Enter a dollar amount rounded to 2 decimal places |
What type of cookie would maximize the companys contribution margin?
| Select a type of cookie Chocolate ChipOatmeal RaisinSugar |
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
