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Saras Salsa Company produces its condiments in two types: Extra Fine for restaurant customers and Family Style for home use. Salsa is prepared in department

Saras Salsa Company produces its condiments in two types: Extra Fine for restaurant customers and Family Style for home use. Salsa is prepared in department 1 and packaged in department 2. The activities, overhead costs, and drivers associated with these two manufacturing processes and the companys production support activities follow.

Process Activity Overhead cost Driver Quantity
Department 1 Mixing $ 7,000 Machine hours 2,900
Cooking 16,200 Machine hours 2,900
Product testing 114,500 Batches 500
$ 137,700
Department 2 Machine calibration $ 350,000 Production runs 700
Labeling 18,500 Cases of output 140,000
Defects 9,500 Cases of output 140,000
$ 378,000
Support Recipe formulation $ 89,000 Focus groups 50
Heat, lights, and water 58,000 Machine hours 2,900
Materials handling 85,000 Container types 10
$ 232,000

Additional production information about its two product lines follows.

Extra Fine Family Style
Units produced 40,000 cases 100,000 cases
Batches 400 batches 100 batches
Machine hours 1,250 MH 1,650 MH
Focus groups 32 groups 18 groups
Container types 5 containers 5 containers
Production runs 310 runs 390 runs

rev: 06_09_2018_QC_CS-128873

5. If the market price is $19 per case of Extra Fine and $12 per case of Family Style, determine the gross profit per case for each product. (Round your intermediate calculations and final answers to 2 decimal places.)

image text in transcribed

Extra Fine Family Style

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