Question
Weatherspoon Company has a product with a selling price per unit of $200, the unit variable cost is $110, and the total monthly fixed costs
Weatherspoon Company has a product with a selling price per unit of $200, the unit variable cost is $110, and the total monthly fixed costs are $300,000. How much is Weatherspoon's contribution margin per unit?
An Italian bakery on Franklin Avenue in Hartford is famous for its cakes. The bakery sells its cakes for $19.95 to the public. The cost for the ingredients and labor to make the cake are $8.45 per cake, and the fixed costs for the bakery for one month are $8,050.
a) Assuming that this bakery only sells cakes, what is the break-even point in number of cakes?
b) This bakery sells 1,500 cakes for the month of April. What is the expected net income?
Skyline Florists uses an activity-based costing system to compute the cost of making floral bouquets and delivering the bouquets to its commercial customers. Company personnel who earn $180,000 typically perform both tasks; other firm-wide overhead is expected to total $70,000. These costs are allocated as follows:
Bouquet Production Delivery Other
Company personnel 60 % 30 % 10 %
Other overhead 50 % 35 % 15 %
Skyline anticipates making 20,000 bouquets and 4,000 deliveries in the upcoming year.
What is the cost of the company personnel's wages and salaries and other overhead that would be charged to each bouquet? (your answer should be under $10.00 per bouquet)
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