T&G Co. manufactures three types of computer desks. The income statement for the three products and the whole company is shown below: Sales Variable costs Fixed costs Total costs Operating income (loss) Product A Product B Product C Total $84,000 $97,000 $140,000 $321,000 42,000 62,000 125,000 229,000 25,900 18,500 18,500 62,900 67,900 80,500 143,500 291,900 $16,100 $16,500 $(3,500) $29,100 The company produces 1,000 units of each product. The company's capacity is 17,000 machine hours. The machine hours for each product are 7 hours for Product A, 5 hours for Product B, and 5 hours for Product C. Fixed costs are allocated based on machine hours. If the current production levels are maintained, should the company eliminate Product C? T&G Co. eliminate Product C. If the company can sell unlimited quantities of any of the three products, which product should be produced? T&G Co. should produce Suppose the company can sell unlimited quantities of any of the three products. If a customer wanted to purchase 570 units of Product C, what would the minimum sale price per unit be for this order? Minimum sale price per unit $ The company has a contract that requires it to supply 570 units of each product to a customer. The total market demand for a single product is limited to 1,500 units. How many units of each product should the company manufacture to maximize its total contribution margin including the contract? T&G Co. should manufacture Product A units Product B units Product C units T&G Co. manufactures three types of computer desks. The income statement for the three products and the whole company is shown below: Sales Variable costs Fixed costs Total costs Operating income (loss) Product A Product B Product C Total $84,000 $97,000 $140,000 $321,000 42,000 62,000 125,000 229,000 25,900 18,500 18,500 62,900 67,900 80,500 143,500 291,900 $16,100 $16,500 $(3,500) $29,100 The company produces 1,000 units of each product. The company's capacity is 17,000 machine hours. The machine hours for each product are 7 hours for Product A, 5 hours for Product B, and 5 hours for Product C. Fixed costs are allocated based on machine hours. If the current production levels are maintained, should the company eliminate Product C? T&G Co. eliminate Product C. If the company can sell unlimited quantities of any of the three products, which product should be produced? T&G Co. should produce Suppose the company can sell unlimited quantities of any of the three products. If a customer wanted to purchase 570 units of Product C, what would the minimum sale price per unit be for this order? Minimum sale price per unit $ The company has a contract that requires it to supply 570 units of each product to a customer. The total market demand for a single product is limited to 1,500 units. How many units of each product should the company manufacture to maximize its total contribution margin including the contract? T&G Co. should manufacture Product A units Product B units Product C units
