Exercise 3.- Determine the optimal production mix and prepare the income statement with the following information: A company produces pillows of three types: Standard, Deluxe and Orthopedic. Orthopedic. Standard $280 $130 2.5 hrs. 1000 units Deluxe $490 $385 2 hrs. 800 units $650 $590 4 hrs. 400 units Unit sales price Unit variable cost Man hours per unit Demand Fixed costs $100,000 This month, there were problems with staff turnover and layoffs, so the workforce is only 5,000 hours.
Exercise 3.- Determine the optimal production mix and prepare the income statement with the following information: A company produces pillows of three types: Standard, Deluxe and Orthopedic. Orthopedic. Standard $280 $130 2.5 hrs. 1000 units Deluxe $490 $385 2 hrs. 800 units $650 $590 4 hrs. 400 units Unit sales price Unit variable cost Man hours per unit Demand Fixed costs $100,000 This month, there were problems with staff turnover and layoffs, so the workforce is only 5,000 hours.
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter3: Cost Behavior And Cost Forecasting
Section: Chapter Questions
Problem 54E: Income Statements under Absorption and Variable Costing In the coming year, Kalling Company expects...
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Transcribed Image Text:Exercise 3.- Determine the optimal production mix and prepare the income statement with the following information:
A company produces pillows of three types: Standard, Deluxe and Orthopedic.
Orthopedic.
Standard
$280
$130
2.5 hrs.
1000 units
Deluxe
$490
$385
2 hrs.
800 units
$650
$590
4 hrs.
400 units
Unit sales price
Unit variable cost
Man hours per unit
Demand
Fixed costs $100,000
This month, there were problems with staff turnover and layoffs, so the workforce is only 5,000 hours.
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