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Please help solve Bright Day Company produces two beverages, Hi-Voltage and Easy Slim. Data about these products follow. Production volume Liquid materials Dry materials Bottles
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Bright Day Company produces two beverages, Hi-Voltage and Easy Slim. Data about these products follow. Production volume Liquid materials Dry materials Bottles Hi-Voltage 11,500 bottles 1,800 gallons 1,320 pounds 11,500 bottles 5 labels per bottle EasySlim 290,000 bottles 37,000 gallons 17,000 pounds 290,000 bottles label(s) per bottle 800 setups 3,600 MH 3 Labels Machine setups Machine hours 900 setups 110 MH Additional data from its two production departments follow. Driver Cost $ Department Mixing department Liquid materials Dry materials Utilities Bottling department Bottles Labeling Machine setup Gallons Pounds Machine hours 1,552 11,908 1,855 Units Labels per bottle Setups $120,600 46,375 59,500 Required: 1 & 2. Determine the cost of each product line using ABC. What is the cost per bottle for Hi-Voltage and Easy Slim? 3. If Hi-Voltage sells for $6.55 per bottle, how much profit does the company earn per bottle of Hi-Voltage that it sells? 4. What is the minimum price that the company should set per bottle of EasySlim? Activity Expected Costs Expected Activity Mixing department Liquid materials Dry materials $ 1,552 38,800 Gallons 11,908 18,320 Pounds Utilities 1,855 3,710 Machine hours Bottling department Bottles $ Bottles 120,600 46,375 59,500 Labeling Machine setup 301,500 851,500 1,700 Labels Setups Hi-Voltage Easy Slim Activity Overhead driver incurred assigned Activity Rate Overhead assigned Activity driver incurred $ 0.04 1,800 $ 0.65 per gallon per pound per machine hour 1,320 | A 0.50 110 55 $ 0.40 per bottle 4,600 11,500 50,000 $ 0.05 per label 2,500 31,500 $ 35.00 per setup 900 $ 38,655 Total overhead cost Production volume(bottles) If Hi-Voltage sells for $6.55 per bottle, how much profit does the company earn per bottle of Hi-Voltage that it sells? (Do not round intermediate calculations and round your final answers to 2 decimal places.) Hi-Voltage Price per unit Cost per unit Profit (loss) per unitStep by Step Solution
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