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Please show how you got the answers: The Hampshire Company manufactures umbrellas that sell for $12.50 each. In 2014, the company made and sold 60,000
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The Hampshire Company manufactures umbrellas that sell for $12.50 each. In 2014, the company made and sold 60,000 umbrellas. The company had fixed manufacturing costs of $216,000. It also had fixed costs for administration of $79,525. The per-unit costs of each umbrella are as follows:
Direct Materials: $3.00
Direct Labor: $1.50
Variable Manufacturing Overhead: $0.40
Variable Selling Expenses: $1.10
Requirement 6 | |||
Units | $ Per Unit | Totals | |
Sales | X | $ | $ |
Variable Costs | X | $ | $ |
Fixed Costs | $ | ||
Net Income | $ | ||
Operating Leverage | Times % Increase | Increase would be XX% | |
Prior Income | $ | From Part 1 | |
Increase | $ | Prior Income X XX% Above | |
Total | $ | ||
Requirement 7 | |||
Targeted Income = (Fixed Costs + Target Income) / Contribution Margin | |||
Fixed Costs + Target Income | Divided by Contribution Margin | # of Units (Rounded) | |
Fixed Costs | $ | ||
Target Income | $ | ||
Total | $ | $ | X |
# of Units Above X $ Per Unit | |||
Proof | Revenue | XX,XXX X $XX.XX | $ |
Variable Costs | XX,XXX X $X.XX | $ | |
Contribution Margin | $ | ||
Fixed Costs | $ | ||
Net Income | $ | ||
Requirement 8 | |||
Sales Mix | |||
Current | Specialty | Total | |
Expected Sales Units | X | X | |
Revenue = Sales X Price | $ | $ | $ |
Variable Costs X Units | $ | $ | $ |
Contribution Margin | $ | $ | $ |
Fixed Costs | $ | $ | $ |
Operating Income | $ | ||
Prior Net Income From Requirement 1 | $ | ||
Additional Operating Income | (Operating Income Above Less Prior Income) | $ | |
Decision With Explanation |
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