Question
Income Statement Product A Product B Product C Max Capacity Units 34,000 5,000 2,000 41,000 Price per unit $ 12.00 $ 7.00 $ 50.00 Variable
| Income Statement | Product A | Product B | Product C | Max Capacity | |||||||||||
| Units | 34,000 | 5,000 | 2,000 | 41,000 | |||||||||||
| Price per unit | $ | 12.00 | $ | 7.00 | $ | 50.00 | |||||||||
| Variable expense per unit | $ | 5.00 | $ | 1.00 | $ | 15.00 | |||||||||
| Total Fixed Costs | $ | 15,000 | $ | 30,000 | $ | 7,500 | |||||||||
Scenario 1: Pete wants to find the mix of units that will result in the highest overall Operating Income, perform this analysis using a two variable data table. Product A can vary between 31,000 units and a maximum of 36,000 units. Product B can vary between 3,000 units and a maximum of 8,000 units. Both Products A and B are manufactured in 1,000-unit increments. The production level of Product C is the same each month at 2,000 units.
Scenario 2: Pete wants each product line in the mix to be profitable. Use a One Variable Data Table and then determine the number of units for each product that should be produced (to the nearest thousand) to make each product line profitable.
| Scenario 2 | Units | Operating Income (loss) |
| Product A | ? | $ |
| Product B | ? | $ |
| Product C | ? | $ |
Please help complete scenario 2
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Principles Of Cost Accounting
Authors: Vanderbeck
13th Edition
0324191693, 978-0324191691
