Principal Managerial Accounting 3 Questions

1.

January Units produced and sold: Sales 800 meals Production 1,100 meals Variable manufacturing cost per meal Sales commission cost per meal Total fixed manufacturing overhead Total fixed selling and administrative costs Rosetta's Foods produces frozen meals that it sells for $15 each. The company computes a new monthly xed manufacturing overhead allocation rate based on the planned number of meals to be produced that month. Assume all costs and production levels are exactly as planned. The following data are from Rosetta's Foods's rst month in business: a (Click the icon to view the data.) Requirement 1. Compute the product cost per meal produced under absorption costing and under variable costing. (Round your answers to the nearest oent.) Absorption Variable costing costing Total product cost per meal :l :l Requirement 2:. Prepare Rosetta's Foods's January income statement using absorption costing. MM Operating Income Requirement 2b. Prepare Rosetta's Foods's January income statement using variable costing. Rosetta's Foods Income Statement (Variable Costing) Month Ended January 31 Operating Income Requirement 3. Is operating income higher under absorption costing or variable costing in January? In January, absorption costing operating income variable costing operating income.Data Table Number of goggles produced 200,000 Number of goggles sold 170,000 Sales price per unit 25 Variable manufacturing cost per unit 14 Sales commission cost per unit 3 Fixed manufacturing overhead 600,000 Fixed selling and administrative costs 180,000 The annual data that follow pertain to Eli's Electric Eyewear, a manufacturer of swimming goggles. (Eli's Electric Eyewear had no beginning Finished Goods Inventory in January.) (Click the icon to view the data.) Requirement 1. Prepare both conventional (absorption costing) and contribution margin (variable costing) income statements for Eli's Electric Eyewear for the year ended December 31. (Round intermediary calculations to the nearest cent.) Begin by preparing Eli's Electric Eyewear's conventional (absorption costing) income statement for the year ended December 31. Eli's Electric Eyewear Income Statement (Absorption Costing) Year Ended December 31 Operating IncomeRequirement 2. Which statement shows the higher operating income? Wh The V income statement shows the higher operating income. The operating income under between the two income statements is attributable to the '7 attached to 7 costing is higher because the units sold the units E 7 The difference in operating income Requirement 3. Eli's Electric Eyewear's marketing vice president believes a new sales promotion that oosts $60,000 would increase sales to 180,000 goggles. Should the company go ahead with the promotion? Give your reasoning. The company W go ahead with the promotion because the additional W the additional cost of the promotion. Data Table X :... Zion Pool Cleaning Service Income Statement For the Month Ended July 31, 2024 Busch Mitz Filip Total Service Revenue 1,500 $ 1,800 $ 3,300 $ 6,600 Variable Costs 900 540 1,650 3,090 Contribution Margin 600 1,260 1,650 3,510 Fixed Costs 2,000 Operating Income $ 1,510Zion Pool Cleaning Service provides pool cleaning services to residential customers. The company has three employees, each assigned to specic customers. The company considers each employee's territory as a business segment. The comrany incurs variable cask that include the employees' wages, pool chemicals, and gas for the service vans. Fixed costs include depreciation on the service vans. Following is the income statement for the month of July: Click the icon to view the income statement.) Requirement 1. Calculate the contribution margin ratio for each business segment. 4 = Contribution margin ratio Busch '-' = % Mitz + = % Filip + = % Requirement 2. The business segments had the following numbers of customers: Busch, 50; Mitz, 60; and Filip, 110. Compute the service revenue per customer, variable cost per customer, and contribution margin per customer for each business segment. Service revenue Variable costs Contribution margin per customer per customer per customer Busch M itz Filip Requirement 3. Which business segment was most protable? List some possible reasons why this segment was most protable. How might the various reasons affect the company in the long term? The W business segment was the most protable because the V Possible reasons for the protability of this business segment include the following: (Select all that apply.) [I A. Better routes with shorter drive times allowing more customers to be served in the most protable business segment [I B. Lengthy routes with longer drive times allowing fewer customers to be served in the most protable business segment [I C. Reducing the amount of pool chemicals used in service calls for the most protable business segment [I D. Lower revenue per customer in the most protable business segment [I E. Higher revenue per customer in the most protable business segment [I F. Lower employee wages in the most protable business segment [I G. Higher employee wages in the most protable business segment [I H. Employees in the most protable business segment cutting corners when performing service calls How might the various reasons affect the company in the long term? The possible side effects of the items identified in the preceding step could be (Select all that apply.) A. increased employee turnover because of low wages. B. less fuel and maintenance costs because of efficient routes. C. highly compensated employees resulting in an increase in contribution margin. D. less fuel and maintenance costs because of lengthier routes. E. increased customer base due to competitive service prices. OF. dissatisfied customers because of inadequate service. G. increased service costs because of reduced pool chemical usage causing poor water quality and additional service calls