Question
In: Accounting
Cane Company manufactures two products called Alpha and Beta that sell for $155 and $115, respectively....
Cane Company manufactures two products called Alpha and Beta that sell for $155 and $115, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 110,000 units of each product. Its average cost per unit for each product at this level of activity are given below:
| Alpha | Beta | |||||||
| Direct materials | $ | 24 | $ | 12 | ||||
| Direct labor | 23 | 26 | ||||||
| Variable manufacturing overhead | 22 | 12 | ||||||
| Traceable fixed manufacturing overhead | 23 | 25 | ||||||
| Variable selling expenses | 19 | 15 | ||||||
| Common fixed expenses | 22 | 17 | ||||||
| Total cost per unit | $ | 133 | $ | 107 | ||||
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars.
11. How many pounds of raw material are needed to make one unit of each of the two products?
12. What contribution margin per pound of raw material is earned by each of the two products? (Round your answers to 2 decimal places.)
Solutions
ekkarill92 answered 10 months agoRelated Solutions
Cane Company manufactures two products called Alpha and Beta that sell for $155 and $115, respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $155 and $115, respectively. Each product uses only
one type of raw material that costs $6 per pound. The company has
the capacity to annually produce 110,000 units of each product. Its
average cost per unit for each product at this level of activity
are given below:
Alpha
Beta
Direct materials
$
24
$
12
Direct labor
23
26
Variable manufacturing overhead
22
12
Traceable fixed manufacturing overhead...
Cane Company manufactures two products called Alpha and Beta that sell for $155 and $115, respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $155 and $115, respectively. Each product uses only
one type of raw material that costs $6 per pound. The company has
the capacity to annually produce 110,000 units of each product. Its
average cost per unit for each product at this level of activity
are given below:
Alpha
Beta
Direct materials
$
24
$
12
Direct labor
23
26
Variable manufacturing overhead
22
12
Traceable fixed manufacturing overhead...
Cane Company manufactures two products called Alpha and Beta that sell for $155 and $115, respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $155 and $115, respectively. Each product uses only
one type of raw material that costs $6 per pound. The company has
the capacity to annually produce 110,000 units of each product. Its
average cost per unit for each product at this level of activity
are given below:
Alpha
Beta
Direct
materials
$
24
$
12
Direct labor
23
26
Variable manufacturing
overhead
22
12
Traceable fixed manufacturing
overhead...
Cane Company manufactures two products called Alpha and Beta that sell for $155 and $115, respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $155 and $115, respectively. Each product uses only
one type of raw material that costs $6 per pound. The company has
the capacity to annually produce 110,000 units of each product. Its
average cost per unit for each product at this level of activity
are given below:
Alpha
Beta
Direct materials
$
24
$
12
Direct labor
23
26
Variable manufacturing overhead
22
12
Traceable fixed manufacturing overhead...
Cane Company manufactures two products called Alpha and Beta that sell for $155 and $115, respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $155 and $115, respectively. Each product uses only
one type of raw material that costs $6 per pound. The company has
the capacity to annually produce 110,000 units of each product. Its
unit costs for each product at this level of activity are given
below:
Alpha
Beta
Direct materials
$
24
$
12
Direct labor
23
26
Variable manufacturing overhead
22
12
Traceable fixed manufacturing overhead
23
25...
Cane Company manufactures two products called Alpha and Beta that sell for $155 and $115, respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $155 and $115, respectively. Each product uses only
one type of raw material that costs $6 per pound. The company has
the capacity to annually produce 110,000 units of each product. Its
unit costs for each product at this level of activity are given
below:
Alpha
Beta
Direct materials
$
24
$
12
Direct labor
23
26
Variable manufacturing overhead
22
12
Traceable fixed manufacturing overhead
23
25...
Cane Company manufactures two products called Alpha and Beta that sell for $190 and $155, respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $190 and $155, respectively. Each product uses only
one type of raw material that costs $8 per pound. The company has
the capacity to annually produce 122,000 units of each product. Its
unit costs for each product at this level of activity are given
below:
Alpha Beta
Direct materials $
40 $
24
Direct labor 34
28
...
Cane Company manufactures two products called Alpha and Beta that sell for $115 and $85 respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $115 and $85 respectively. Each product uses only one
type of raw material that costs $6 per pound. The company has the
capacity to annually produce 100,000 units of each product. Its
unit costs for each product at this level of activity are given
below:
Alpha
Beta
Direct Materials
30
12
Direct Labor
20
15
Variable manufacturing overhead
7
5
Traceable fixed manufacturing overhead
15
14
Variable selling...
Cane Company manufactures two products called Alpha and Beta that sell for $185 and $120, respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $185 and $120, respectively. Each product uses only
one type of raw material that costs $5 per pound. The company has
the capacity to annually produce 112,000 units of each product. Its
average cost per unit for each product at this level of activity
are given below:
Alpha
Beta
Direct materials
$
30
$
10
Direct
labor
22
29
Variable
manufacturing overhead
20
13
Traceable fixed
manufacturing overhead...
Cane Company manufactures two products called Alpha and Beta that sell for $185 and $120, respectively....
Cane Company manufactures two products called Alpha and Beta
that sell for $185 and $120, respectively. Each product uses only
one type of raw material that costs $5 per pound. The company has
the capacity to annually produce 112,000 units of each product. Its
average cost per unit for each product at this level of activity
are given below:
The company considers its traceable fixed manufacturing overhead
to be avoidable, whereas its common fixed expenses are unavoidable
and have been...
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