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Product Profitability Analysis Galaxy Sports Inc. manufactures and sells two styles of All Terrain Vehicles (ATVS), the Conquistador and Hurricane, from a single manufacturing facility.
Product Profitability Analysis Galaxy Sports Inc. manufactures and sells two styles of All Terrain Vehicles (ATVS), the Conquistador and Hurricane, from a single manufacturing facility. The manufacturing facility operates at 100% of capacity. The following per-unit information is available for the two products: Conquistador Hurricane Sales price $5,400 $3,600 Variable cost of goods sold (3,400) (2,410) Manufacturing margin $2,000 $1,190 Variable selling expenses (866) (506) Contribution margin $1,134 $684 Fixed expenses (530) (270) Operating income $604 $414 In addition, the following sales unit volume information for the period is as follows: Sales unit volume Conquistador 3,300 Hurricane 2,400 a. Prepare a contribution margin by product report. Compute the contribution margin ratio for each product as a whole percent. Galaxy Sports Inc. Contribution Margin by Product Sales Variable cost of goods sold Manufacturing margin Variable selling expenses Conquistador Hurricane Contribution margin Contribution margin ratio % %
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