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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 $6,400 $4,200 Variable cost of goods sold (4,030) (2,810) Manufacturing margin $2,370 $1,390 variable selling expenses (962) (550) Contribution margin $1,408 $840 Fixed expenses (660) (340) Operating income $748 $500 In addition, the following sales unit volume information for the period is as follows: Conquistador Hurricane Sales unit volume 3,500 2,500 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 Conquistador Hurricane Sales 22,400,000 10,500,000 Variable cost of goods sold Manufacturing margin Variable selling expenses Contribution margin Contribution margin ratio %
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