Question
In: Accounting
Biscayne’s Rent-A-Ride rents two models of automobiles: the standard and the deluxe. Information follows: Standard Deluxe...
Biscayne’s Rent-A-Ride rents two models of automobiles: the
standard and the deluxe. Information follows:
| Standard | Deluxe | ||||
| Rental price per day | $ | 40.00 | $ | 46.00 | |
| Variable cost per day | 14.40 | 18.40 | |||
Biscayne’s total fixed cost is $13,120 per month.
Required:
1. Determine the contribution margin per rental day and
contribution margin ratio for each model that Biscayne’s offers.
(Round your "Unit Contribution
Margin" answers to 2 decimal
places.)
2. Which model would Biscayne’s prefer to
rent?
| Deluxe Model | |
| Standard Model |
3. Calculate Biscayne’s break-even point if the
product mix is 50/50. (Do not round intermediate
calculations. Round your final
answer to the nearest whole number.)
4. Calculate the break-even point if Biscayne’s
product mix changes so that the standard model is rented 75 percent
of the time and the deluxe model is rented for only 25 percent.
(Do not round intermediate calculations.
Round your final answer
to the nearest whole
number.)
5. Calculate the break-even point if Biscayne’s
product mix changes so that the standard model is rented 25 percent
of the time and the deluxe model is rented for 75 percent.
(Do not round intermediate calculations.
Round your final answer to the
nearest whole number.)
Solutions
ekkarill92 answered 2 years agoRelated Solutions
Biscayne’s Rent-A-Ride rents two models of automobiles: the standard and the deluxe. Information follows: Standard Deluxe...
Biscayne’s Rent-A-Ride rents two models of automobiles: the
standard and the deluxe. Information follows:
Standard
Deluxe
Rental price per day
$
46.00
$
54.00
Variable cost per day
18.40
24.30
Biscayne’s total fixed cost is $14,525 per month.
Required:
1. Determine the contribution margin per rental day and
contribution margin ratio for each model that Biscayne’s offers.
(Round your "Unit Contribution
Margin" answers to 2 decimal
places.)
2. Which model would Biscayne’s prefer to
rent?
Deluxe Model
Standard Model
3....
Biscayne’s Rent-A-Ride rents two models of automobiles: the standard and the deluxe. Information follows: Standard Deluxe...
Biscayne’s Rent-A-Ride rents two models of automobiles: the
standard and the deluxe. Information follows:
Standard
Deluxe
Rental price per day
$
30.00
$
38.00
Variable cost per day
10.50
15.20
Biscayne’s total fixed cost is $18,500 per month.
Required:
1. Determine the contribution margin per rental day and
contribution margin ratio for each model that Biscayne’s offers.
(Round your "Unit Contribution
Margin" answers to 2 decimal
places.)
2. Which model would Biscayne’s prefer to
rent?
Deluxe Model
Standard Model
3....
Dartmouth Corporation manufactures two models of office chairs, a standard and a deluxe model. The following...
Dartmouth Corporation manufactures two models of office chairs,
a standard and a deluxe model. The following activity and cost
information has been compiled:
Number
of Number
of Number
of
Product Setups Components Direct
Labor Hours
Standard 15 9 300
Deluxe 31 20 235
Overhead
costs $78,200 $89,900
Number of setups and number of components are identified as
activity-cost drivers for overhead. Assuming an activity-based
costing system is used, what is the total amount of overhead costs
assigned to the standard model?
A) $87,500
B) $114,700
C) $80,600
D) $84,050
Comfort Corporation manufactures two models of office chairs, a standard and a deluxe model. The following...
Comfort Corporation manufactures two models of office chairs, a
standard and a deluxe model. The following activity and cost
information has been compiled:
Number
of Number
of Number
of
Product Setups Components Direct
Labor Hours
Standard 12 8 255
Deluxe 28 12 245
Overhead
costs $52,000 $78,000
3) Assume a traditional costing system applies the overhead
costs based on direct labor hours. What is the total amount of
overhead costs assigned to the standard model?
A) $65,700
B) $63,600
C) $66,300
D) $66,700
4) Assume a traditional costing system applies the overhead
costs...
Penty's Fine Furniture manufactures two models of chairs, a standard and a deluxe model. The following...
Penty's Fine Furniture manufactures two models of chairs, a
standard and a deluxe model. The following activity and cost
information has been compiled:
Standard
Deluxe
# DL Hours
924
930
# Set Ups
28
62
# Components
5
8
Total estimated manufacturing overhead for the period is
$860,000. Penty's currently uses a volume-based costing system with
direct labor hours as the only cost driver.
a. Calculate the amount of manufacturing overhead allocated to
each product under a traditional volume-based system....
Mexpal Corporation manufactures two models of power drills, a standard and a deluxe model. The following...
Mexpal Corporation manufactures two models of power drills, a
standard and a deluxe model. The following activity and overhead
cost information has been compiled: Number of Number of Number of
Product Setups Components Direct Labor Hours Standard 15 10 800
Deluxe 35 15 400 Set-up activity Inspection Activity Overhead costs
$40,000 $32,000
1. Assume a traditional costing system applies the total
overhead costs (sum of set-up activity and inspection activity
costs) based on direct labor hours. What is the total...
Taylor Corporation produces two models of their leather brief cases: deluxe and standard. The four activities...
Taylor Corporation produces two models of their leather brief
cases: deluxe and standard. The four activities and four drivers
are as follows:
Hours
Activities:
Cost
Driver
Deluxe
Standard
Total
Cutting
$ 96,000
Cutting hours
2,200
1,300
3,500
Assembling
42,000
Assembly hours
1,150
980
2,130
Inspecting
15,000
Inspection hours
800
500
1,300
Reworking
8,000
Rework hours
20
35
55
Required:
Calculate the consumption ratios for the four
drivers, rounding to 2 decimal places.
Calculate the activity rates that would be used...
Dunphy Inc. produces three models of a certain product: Standard, Deluxe, and Super. Relevant data: Standard...
Dunphy Inc.
produces three models of a certain product: Standard, Deluxe, and
Super. Relevant data:
Standard
Deluxe
Super
Sales in units
12,000
5,000
3,000
Price per unit
85
120
166
Variable cost per unit
34
45
84
Fixed costs are $1,000,000.
a)
Compute Dunphy's breakeven point in sales dollars
with the current sales mix.
b)
Compute Dunphy's current margin of safety.
c)
What is forecast net income at sales of $2,400,000
given the current sales mix?
d)
Marketing Department has...
Dillon Inc. produces three models of a certain product: Standard, Deluxe, and Super. Relevant data: Standard...
Dillon Inc.
produces three models of a certain product: Standard, Deluxe, and
Super. Relevant data:
Standard
Deluxe
Super
Sales in units
12,000
5,000
3,000
Price per unit
85
120
166
Variable cost per unit
34
45
84
Fixed costs are $1,000,000.
a)
Compute Dillon Inc. breakeven point in sales
dollars with the current sales mix.
b)
Compute Dillon Inc. current margin of safety.
c)
What is forecast net income at sales of $2,400,000
given the current sales mix?
d)
Marketing...
Sales and Production Budgets Berring Company produces two products: the deluxe and the standard. The deluxe...
Sales and Production Budgets
Berring Company produces two products: the deluxe and the
standard. The deluxe sells for $40, and the standard sells for $10.
Projected sales of the two models for the coming four quarters are
given below.
Deluxe
Standard
First quarter
11,000
90,000
Second quarter
14,500
88,600
Third quarter
16,800
93,000
Fourth quarter
20,000
91,400
The president of the company believes that the projected sales
are realistic and can be achieved by the company. In the factory,
the...
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