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a. Prepare a contribution margin by product report. Calculate the contribution margin ratio for each. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.

a. Prepare a contribution margin by product report. Calculate the contribution margin ratio for each. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.

Accounting
Accounting
27th Edition
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Chapter21: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 21.28EX: Appendix Absorption costing income statement On June 30, the end of the first month of operations,...
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a. Prepare a contribution margin by product report. Calculate the contribution margin ratio for each. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.
Instructions PowerTrain Sports Inc. manufactures and sells two styles of All Terrain Vehicles (ATVS), the Mountain Monster and Desert Dragon, from a single manufacturing facility. The manufacturing facility operates at 100% of capacity. The following per-unit information is available for the two products: Mountain Desert Dragon 1 Monster 2 Sales price $5,300.00 $5,300.00 3 Variable cost of goods sold 3,210.00 3,350.00 4 Manufacturing margin $2,090.00 $1,950.00 5 Variable selling expenses 1,030.00 1,102.00 6 Contribution margin $1,060.00 $848.00 7 Fixed expenses 470.00 305.00 8 Income from operations $590.00 $543.00
Transcribed Image Text:Instructions PowerTrain Sports Inc. manufactures and sells two styles of All Terrain Vehicles (ATVS), the Mountain Monster and Desert Dragon, from a single manufacturing facility. The manufacturing facility operates at 100% of capacity. The following per-unit information is available for the two products: Mountain Desert Dragon 1 Monster 2 Sales price $5,300.00 $5,300.00 3 Variable cost of goods sold 3,210.00 3,350.00 4 Manufacturing margin $2,090.00 $1,950.00 5 Variable selling expenses 1,030.00 1,102.00 6 Contribution margin $1,060.00 $848.00 7 Fixed expenses 470.00 305.00 8 Income from operations $590.00 $543.00
Instructions 4 Manufacturing margin $2,090.00 $1,950.00 5 Variable selling expenses 1,030.00 1,102.00 6 Contribution margin $1,060.00 $848.00 7 Fixed expenses 470.00 305.00 8 Income from operations $590.00 $543.00 In addition, the following sales unit volume information for the period is as follows: Mountain Monster Desert Dragon Sales unit volume 4,800 4,650 Required: a. Prepare a contribution margin by product report. Calculate the contribution margin ratio for each. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. b. What advice would you give to the management of PowerTrain Sports Inc. regarding the relative profitability of the two products?
Transcribed Image Text:Instructions 4 Manufacturing margin $2,090.00 $1,950.00 5 Variable selling expenses 1,030.00 1,102.00 6 Contribution margin $1,060.00 $848.00 7 Fixed expenses 470.00 305.00 8 Income from operations $590.00 $543.00 In addition, the following sales unit volume information for the period is as follows: Mountain Monster Desert Dragon Sales unit volume 4,800 4,650 Required: a. Prepare a contribution margin by product report. Calculate the contribution margin ratio for each. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. b. What advice would you give to the management of PowerTrain Sports Inc. regarding the relative profitability of the two products?
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