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	$4,400		$3,000
Variable cost of goods sold	(2,770)		(2,010)
Manufacturing margin	$1,630		$990
Variable selling expenses	(750)		(450)
Contribution margin	$880		$540
Fixed expenses	(410)		(220)
Operating income	$470		$320

In addition, the following sales unit volume information for the period is as follows:

	Conquistador	Hurricane
Sales unit volume	3,500		2,500

Question Content Area

a. contribution margin by product report. Compute the contribution margin ratio for each product as a whole percent.

	Conquistador	Hurricane
Contribution marginCost of goods soldDirect laborGross profitSalesSales	$	$
Fixed cost of goods soldFixed selling expensesManufacturing marginSalesVariable cost of goods soldVariable cost of goods sold
Contribution marginCost of goods soldFixed manufacturing costsGross profitManufacturing marginManufacturing margin	$	$
Fixed cost of goods soldFixed selling expensesManufacturing marginSalesVariable selling expensesVariable selling expenses
Contribution marginCost of goods manufacturedFixed manufacturing costsFixed salesManufacturing marginContribution margin	$	$
Contribution margin ratioFixed manufacturing costsFixed salesManufacturing marginVariable cost of goods soldContribution margin ratio