Question
In: Accounting
T&G Co. manufactures three types of computer desks. The income statement for the three products and...
T&G Co. manufactures three types of computer desks. The
income statement for the three products and the whole company is
shown below:
| Product A | Product B | Product C | Total | ||||||
| Sales | $75,000 | $95,000 | $105,000 | $275,000 | |||||
| Variable costs | 40,000 | 60,000 | 95,000 | 195,000 | |||||
| Fixed costs | 22,400 | 16,000 | 16,000 | 54,400 | |||||
| Total costs | 62,400 | 76,000 | 111,000 | 249,400 | |||||
| Operating income (loss) | $12,600 | $19,000 | $(6,000 | ) | $25,600 |
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.
a) The company has a contract that requires it to supply 430
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 | ||
Solutions
ekkarill92 answered 1 year agoRelated Solutions
T&G Co. manufactures three types of computer desks. The income statement for the three products and...
T&G Co. manufactures three types of computer desks. The
income statement for the three products and the whole company is
shown below:
Product A
Product B
Product C
Total
Sales
$76,000
$104,000
$115,000
$295,000
Variable costs
41,000
69,000
105,000
215,000
Fixed costs
25,900
18,500
18,500
62,900
Total costs
66,900
87,500
123,500
277,900
Operating income (loss)
$9,100
$16,500
$(8,500
)
$17,100
The company produces 1,000 units of each product. The company’s
capacity is 17,000 machine hours. The machine hours for each...
The DC Desk Company manufactures two types of computer desks from laminated particle board. The Senior...
The DC Desk Company manufactures two types of computer desks
from laminated particle board. The Senior Geek model requires 30
square feet of particle board, 1 keyboard sliding tray and 5 hours
of labor to fabricate. This model has a net profit of $105. The Jr.
Geek model requires 24 square feet of particle board, 1 keyboard
sliding tray and 3 hours of labor to fabricate. The Jr. Geek model
has a net profit of $95. During the next production...
Variable and Absorption Costing—Three Products Winslow Inc. manufactures and sells three types of shoes. The income...
Variable and Absorption Costing—Three Products
Winslow Inc. manufactures and sells three types of shoes. The
income statements prepared under the absorption costing method for
the three shoes are as follows:
Winslow Inc.
Product Income Statements—Absorption Costing
For the Year Ended December 31, 20Y1
Cross Training Shoes
Golf Shoes
Running Shoes
Revenues
$559,800
$324,700
$269,500
Cost of goods sold
291,100
159,100
180,600
Gross profit
$268,700
$165,600
$88,900
Selling and administrative expenses
231,100
119,200
148,500
Income (loss) from operations
$37,600
$46,400
$(59,600)...
Variable and Absorption Costing—Three Products Winslow Inc. manufactures and sells three types of shoes. The income...
Variable and Absorption Costing—Three Products
Winslow Inc. manufactures and sells three types of shoes. The
income statements prepared under the absorption costing method for
the three shoes are as follows:
Winslow Inc.
Product Income Statements—Absorption Costing
For the Year Ended December 31, 20Y1
Cross Training Shoes
Golf Shoes
Running Shoes
Revenues
$340,200
$200,700
$172,600
Cost of goods sold
(176,900)
(98,300)
(115,600)
Gross profit
$163,300
$102,400
$57,000
Selling and administrative expenses
(140,400)
(73,700)
(95,200)
Operating income
$22,900
$28,700
$(38,200)
In addition,...
Variable and Absorption Costing—Three Products Winslow Inc. manufactures and sells three types of shoes. The income...
Variable and Absorption Costing—Three Products
Winslow Inc. manufactures and sells three types of shoes. The
income statements prepared under the absorption costing method for
the three shoes are as follows:
Winslow Inc.
Product Income Statements—Absorption Costing
For the Year Ended December 31, 20Y1
Cross Training Shoes
Golf Shoes
Running Shoes
Revenues
$533,200
$314,600
$270,600
Cost of goods sold
(277,300)
(154,200)
(181,300)
Gross profit
$255,900
$160,400
$89,300
Selling and administrative expenses
(220,100)
(115,500)
(149,100)
Operating income
$35,800
$44,900
$(59,800)
In addition,...
Variable and Absorption Costing—Three Products Winslow Inc. manufactures and sells three types of shoes. The income...
Variable and Absorption Costing—Three Products
Winslow Inc. manufactures and sells three types of shoes. The
income statements prepared under the absorption costing method for
the three shoes are as follows:
Winslow Inc.
Product Income Statements—Absorption Costing
For the Year Ended December 31, 20Y1
Cross Training Shoes
Golf Shoes
Running Shoes
Revenues
$472,600
$297,700
$250,100
Cost of goods sold
245,800
145,900
167,600
Gross profit
$226,800
$151,800
$82,500
Selling and administrative expenses
195,000
109,300
137,800
Income (loss) from operations
$31,800
$42,500
$(55,300)...
Variable and Absorption Costing—Three Products Winslow Inc. manufactures and sells three types of shoes. The income...
Variable and Absorption Costing—Three Products
Winslow Inc. manufactures and sells three types of shoes. The
income statements prepared under the absorption costing method for
the three shoes are as follows:
Winslow Inc.
Product Income Statements—Absorption Costing
For the Year Ended December 31, 20Y1
Cross Training Shoes
Golf Shoes
Running Shoes
Revenues
$519,900
$296,300
$257,800
Cost of goods sold
(270,300)
(145,200)
(172,700)
Gross profit
$249,600
$151,100
$85,100
Selling and administrative expenses
(214,700)
(108,800)
(142,100)
Operating income
$34,900
$42,300
$(57,000)
In addition,...
Variable and Absorption Costing—Three Products Winslow Inc. manufactures and sells three types of shoes. The income...
Variable and Absorption Costing—Three Products
Winslow Inc. manufactures and sells three types of shoes. The
income statements prepared under the absorption costing method for
the three shoes are as follows:
Winslow Inc.
Product Income Statements—Absorption Costing
For the Year Ended December 31, 20Y1
Cross Training Shoes
Golf Shoes
Running Shoes
Revenues
$360,800
$212,900
$181,000
Cost of goods sold
187,600
104,300
121,300
Gross profit
$173,200
$108,600
$59,700
Selling and administrative expenses
149,000
78,200
99,700
Income (loss) from operations
$24,200
$30,400
$(40,000)...
Variable and Absorption Costing—Three Products Winslow Inc. manufactures and sells three types of shoes. The income...
Variable and Absorption Costing—Three Products
Winslow Inc. manufactures and sells three types of shoes. The
income statements prepared under the absorption costing method for
the three shoes are as follows:
Winslow Inc.
Product Income Statements—Absorption Costing
For the Year Ended December 31, 20Y1
Cross Training Shoes
Golf Shoes
Running Shoes
Revenues
$396,100
$229,700
$199,800
Cost of goods sold
206,000
112,600
133,900
Gross profit
$190,100
$117,100
$65,900
Selling and administrative expenses
163,500
84,300
110,100
Income (loss) from operations
$26,600
$32,800
$(44,200)...
Henna Co. produces and sells two products, T and O. It manufactures these products in separate...
Henna Co. produces and sells two products, T and O. It
manufactures these products in separate factories and markets them
through different channels. They have no shared costs. This year,
the company sold 43,000 units of each product. Sales and costs for
each product follow.
Product T
Product O
Sales
$
761,100
$
761,100
Variable costs
608,880
76,110
Contribution margin
152,220
684,990
Fixed costs
33,220
565,990
Income before taxes
119,000
119,000
Income taxes (30% rate)
35,700
35,700
Net income
$...
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