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Vogel Co. produces three models of heating and air conditioning thermostat components. The following table summarizes data about each model: Vogel Co. produces three models
Vogel Co. produces three models of heating and air conditioning thermostat components. The following table summarizes data about each model:
Vogel Co. produces three models of heating and air conditioning thermostat components. The following table summarizes data about each model BV19 HV41 MV12 $10 Selling price per unit Contribution margin per unit Units sold per month Total contribution margin Direct fixed expenses Segment margin Allocated company fixed expenses Operating income (loss) $12 4 3,000 $ 12,000 5,200 $ 6,800 3.333 $ 3,467 $ 20 1,500 3,700 4,500 $ 9,0009 000 6,100 $ 2,900 5,000 S 5,300 1.6675.00 $ 3,633 $(2,100) Required a. On what basis does the $10,000 of company fixed expenses appear to be allocated? O The $10,000 of company fixed expenses is apparently being allocated based on the number of units of each model sold O The $10,000 of company fixed expenses is apparently being allocated based on the contribution margin per unit of each model sold O The $10,000 of company fixed expenses is apparently being allocated based on the selling price per unit of each model sold b. Calculate the effect on total company net income if the MV12 model were discontinued he net income would c. Calculate the contribution margin ratio for each model. (Enter your answers as a percentage rounded to 1 decimal place (i.e., 32.1)) HV41 BV19 MV12 Contribution margin ratio d. If an advertising campaign focusing on a single model were to result in an increase of 5,000 units in the quantity of units sold, which model should be advertised? HV41 O BV19 MV12 e. If an advertising campaign focusing on a single model were to result in an increase of $15,000 in revenues, which model should be advertised? HV41 BV19 AH12Step by Step Solution
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