Question
PROBLEM Product A Product B Estimated sales (units) 5,000 2,000 Selling price per unit $ 8.00 $ 15.00 Purchase price per unit $ 2.00 $
PROBLEM |
|
|
| Product A | Product B |
Estimated sales (units) | 5,000 | 2,000 |
Selling price per unit | $ 8.00 | $ 15.00 |
Purchase price per unit | $ 2.00 | $ 6.00 |
Freight in per unit | $ 1.00 | $ 1.00 |
The total production overhead is $ 200,000 and 7% is allocated against products A and B. The allocation of this overhead is further divided on the basis of number of units sold.
Administrative overhead amounts to $ 70,000 and 10% of this overhead is allocated against products A and B. The allocation of this overhead is further divided on the basis of revenue.
- Revenue for product A is .
- Total revenue is .
- Cost of sales per unit for product B .
-
- Total cost of sales for product B .
-
- Total profit margin before overhead allocation is .
- Total production overhead allocated to products A and B is
-
- Administrative overhead allocated to product A is .
-
- Profit after allocation of both overhead amounts for product A is .
-
- Profit after allocation of both overhead amounts for product B is .
-
A business sells $ 60,000 and $ 80,000 worth of goods in January and February respectively. The controller indicates that 50% of the customers pay their bills on a cash basis, 40% in 30 days and 10% in 60 days. During the month of January and February, the company purchased 30,000 and $50,000 worth of goods from suppliers respectively. The companys policy is to pay 50% on a cash basis and the other 50% during the following 30 days. The monthly administrative expenses are broken down as follows:
Salaries
$ 12,000
Depreciation
2,000
Rent
3,000
Office supplies
500
Communication services
500
The companys opening cash balance for the month of January is $ 1,000.
- Monthly cash receipts from sales are as follows:
-
January February
March
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started