Joey Bag-o-donuts owns an ice cream shop. Looking at last year's utility bills, the highest utility bill was $4000 for 2000 machine hours. The lowest utility bill was $2500 for 1200 machine hours. 1. Calculate the variable rate per machine hour and the total fixed utility cost. 2. Show the equation for determining total utility costs. 3. If Joey plans on using 1500 machine hours, what will the total utility bill be using the equation in part 2.
Q: A jeans maker is designing a new line of jeans called Slims. The jeans will sell for $330 per pair…
A: The contribution margin is calculated as difference between sales and variable costs.
Q: Thomas and Theresa work for a company that receives $75 for each unit of output sold. The company…
A: solution given Selling price per unit $75 Variable cost per unit $30 Fixed cost…
Q: use the contribution margin approach.
A: Meaning of Contribution Margin Approach Contribution Margin approach is used to calculate the net…
Q: Bill owns a machine shop. In reviewing the shop's utility bills for the past 12 months, he found…
A:
Q: The owner of the Moxy Hotel in downtown Washington, DC, offers two room types: “deluxe” and…
A: Under the assumption that the variable cost of a deluxe room is the same as that of a regular room…
Q: Adam Granger operates a kiosk in downtown Chicago, at which he sells one style of baseball hat. He…
A: Margin of Safety In a simple term margin of safety which describes as the difference between the…
Q: You want to open up a custom skateboard shop. You can sell each skateboardfor $160. It takes 3 hours…
A: Excel Spreadsheet: Excel Workings:
Q: In a recently opened shopping mall, Jagdeep sells handmade coffee mugs in abooth for $25 each and…
A: Given information: Total number of units 200 mugs Selling price per unit is $25 Fixed costs are…
Q: uses 34,000 rolls annually in the production of deli sandwiches. The costs to make the rolls are:…
A: Introduction:- The following basic information as follows under:- Currently total cost to make the…
Q: Assume I sell each pair of socks for $78 and they cost $23 to produce. I also have costs to run my…
A: As per our guidelines we are supposed to answer only one question (if there are multiple questions…
Q: Joyce Murphy runs a courier service in downtown Seattle. She charges clients $0.59 per mile driven.…
A:
Q: The owner of a car wash wants to increase his Revenue. He decides to reduce his price by $2.00.…
A: Existing Scenario - Contribution per car = $10.99 -$ 1.99 Contribution per car = $ 9.00 Total…
Q: To pay for his academic fees, Tarek, a college student, is selling a computer accessory to other…
A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…
Q: OrdEco is a social economy enterprise that recycles used computers for resale. Take note of its…
A: Economic order quantity (EOQ) is a concept under inventory management which determines the optimal…
Q: It costs People’s Place $0.20 for coffee beans per each cup of coffee, $0.10 per coffee cup, and…
A: The Break-even point is the minimum point of sale for the survival of the entity. At this point, the…
Q: Colin's accountant told him about contribution margin ratios and he understood clearly that for…
A: Selling Price per unit = $700 Fixed Costs = Rent and Utilities + Wages and Benefits to Luthier +…
Q: Elise and her friend Eloi developed an online car repair training course and sell it for $67.50 per…
A: Break even point means a point where firm is neither earning profit nor incurring any loss. For…
Q: Elise and her friend Eloi developed an online car repair training course and sell it for $69 per…
A: The Break-even point is the level of sales at which the operating profit of the company is zero. In…
Q: Mary Williams, owner of Williams Products, is evaluating whether to introduce a new product line.…
A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…
Q: After leaming the calculations presented, you can now compute the projected costs by month on your…
A: Projected revenue and expense are determined to aid better decision making.
Q: Mark Harris operates a kiosk in downtown Chicago, at which he sells one style of baseball hat. He…
A: Income before tax= Net income / (1 - tax rate) = $44,100 / (1 - 0.30) = $63,000
Q: Lia ITZY has determined that the annual demand for number 6 screws is 100,000 screws. Lia, who works…
A: Solution:- i)Calculation of average inventory as follows under:- Average inventory = EOQ / 2
Q: Juanita is planning to make fancy, multi-tiered wedding cakes for the next wedding season. To make…
A: The contribution margin is the total amount of profits and fixed costs for an entity which is used…
Q: A tiny firm in Bulacan makes portable threshers for the area's palay growers. The shop can create…
A: Here in this question, we are required to calculate break even point in unit and make a graphical…
Q: (a) What is the break-even point for each machine? (b) If Zoe expects to make 10,000 copies per…
A: a) Calculation of break even point for each machine: Machine-1 Machine-2 Selling price 0.05…
Q: Radovilsky Manufacturing Company, in Hayward, California, makes flashing lights for toys. The…
A: Optimal Size = 2 x Annual Demand x Cost per setup ÷ Holding cost per unit(1−Demand/Production)…
Q: Hawk Homes, Inc., makes one type of birdhouse that it sells for $30.00 each. Its variable cost is…
A: Disclaimer: Since you have put a multi-part question, we are providing you with the solutions to the…
Q: José Ruiz wants to start a company that makes snowboards. Competitors sell a similar snowboard for…
A: The product should be priced where the company earn a profit. To earn profit sales price should be…
Q: AdamGranger operates a kiosk in downtown Chicago, at which he sells one style of baseball hat. He…
A: Break even point refers to that volume of operation where, there is no profit or loss to an…
Q: Charli was a professional classical guitar player until his motorcycle accident that left him…
A: Formula: Sales at desired profit=(Total Fixed cost+Targeted Profit)Contribution Margin per unit
Q: You plan on starting a lawn mowing business by investing $700 and plan to charge your customers $15…
A: Fixed Costs are the cost that remain constant irrespective of the level of output/Sales. Variable…
Q: Alex Miller, Inc., sells car batteries to service stations for an average of $30 each. The variable…
A: Break even point can be defined as the production level at which the manufacturing costs is equal to…
Q: Brownstone Windows is a small company that installs windows. Its cost structure is as follows: E…
A: Margin of safety means sales revenue over and above break even point sales revenue.
Q: Joey Bag-o-donuts owns an ice cream shop. Looking at last year's utility bills, the highest utility…
A: Definition: High-low method: It is a method of estimating the variable cost per unit and the fixed…
Q: Traylor Windows' breakeven revenues is $1,870,000 and breakeven units is 3,400. Calculate the…
A: Margin of safety is the excess of revenue earned by company compared to break even revenue.
Q: Ella buys a machine for $ 18,500, less discounts of 20% and 15%. The overhead expenses are 8% on…
A: Selling price refers to the actual price on which the seller sells the goods or services to the…
Q: The company produces and sells athletic shoes for children. The costs associated with each pair of…
A: Additional revenue =Additional sale output ×Sales price Given: Additional saale output =100…
Q: Mary Ann is the wife of Kevin Lomax (an associate of John Milton) and earns a little extra money by…
A: The question is based on the concept of Costing.
Q: Last year, Pinwheel Industries introduced a new toy. It cost $1, 900 to develop the toy and $ 35 to…
A: There are two types of costs that are incurred in the business. One is fixed costs, which do not…
Q: You have developed the following estimates for procuring an item for your manufacturing operations:…
A: Solution:- Calculation of which option is best as follows under:-
Q: José Ruiz wants to start a company that makes snowboards. Competitors sell a similar snowboard for…
A: Selling price: It can be defined as the amount that is paid by the buyer for the purchase of…
Q: are opening a coffee shop. You estimate the weekly costs of $375 for rent, $2100 for employee costs,…
A: Total cost is function of fixed cost and variable cost. Fixed cost has no relation to volume and…
Q: Suppose that at one of the Talbot's shops, marginal cost of a coat is constant at $150, and total…
A: By incurring additional expenditure of $ 1500 towards advertising talbots shop sales…
Q: You are going to open a business making custom cabinets. You can sell each cabinet for $80. It takes…
A: PLEASE LIKE THE ANSWER NOTE : AS QUESTION SPECIFY "Part D is needed"
Q: You plan on starting a lawn mowing business by investing $700 of your own money and purchasing $500…
A: Contribution margin: It is the difference between the revenue and the variable cost.
Q: The RideEm Bicycles factory can produce 160 bicycles in a day at a total cost of $10,600 and it can…
A: Computation: 160X+Y=10,600→1180X+Y=11,200→2
Step by step
Solved in 3 steps with 3 images
- Country Diner currently makes cookies for its boxed lunches. It uses 40,000 cookies annually in the production of the boxed lunches. The costs to make the cookies are: A potential supplier has offered to sell Country Diner the cookies for $0.85 each. If the cookies are purchased, 10% of the fixed overhead could be avoided. If Jason accepts the offer, what will the effect on profit be?Garrison Boutique, a small novelty store, just spent $4,000 on a new software program that will help in organizing its inventory. Due to the steep learning curve required to use the new software, Garrison must decide between hiring two part-time college students or one full-time employee. Each college student would work 20 hours per week, and would earn $1 S per hour. The full-time employee would work 40 hours per week and would earn $15 per hour plus the equivalent of $2 per hour in benefits. Employees are given two polo shirts to wear as their uniform. The polo-shirts cost Garrison $10 each. What are the relevant costs, relevant revenues, sunk costs, and opportunity costs for Garrison?Jean and Tom Perritz own and manage Happy Home Helpers, Inc. (HHH), a house-cleaning service. Each cleaning (cleaning one house one time) takes a team of three house cleaners about 1.5 hours. On average, HHH completes about 15,000 cleanings per year. The following total costs are associated with the total cleanings: Required: 1. Calculate the prime cost per cleaning. 2. Calculate the conversion cost per cleaning. 3. Calculate the total variable cost per cleaning. 4. Calculate the total service cost per cleaning. 5. What if rent on the office that Jean and Tom use to run HHH increased by 1,500? Explain the impact on the following: a. Prime cost per cleaning b. Conversion cost per cleaning c. Total variable cost per cleaning d. Total service cost per cleaning
- Karens Quilts is considering the purchase of a new Long-arm Quilt Machine that will cost $17,500 and will increase her fixed costs by $119. What would happen if she purchased the new quilt machine to realize the variable cost savings of $5.00 per quilt, and what would happen if she raised her price by just $5.00? She feels confident that such a small price increase will not decrease the sales in units that will help her offset the increase in fixed costs. Given the following current prices how would the break-even in units and dollars change? Complete the monthly contribution margin income statement for each of these cases.Dr. Detail is a mobile car wash. The price for a standard wash is $35 and takes half an hour. Each worker is paid $20/hr, uses $5 of materials and $0.50 per mile to use their own vehicle to travel from job to job. The average job is 5 miles. Ernest Kuhns son got sick in the car, and Ernest Kuhn has asked Dr. Detail to detail his car instead of doing a simple wash and vacuum. A. Determine the differential income if $100 was charged to detail the car. Each car detail will take 2 hours. The materials used by the worker is three times that of a standard car wash. B. If the price is raised to $150, what is the differential income change? C. Keeping the price at $150, if the worker rate per hour would increase to $20/hr how would the differential income change? Prepare an Excel spreadsheet. D. What other issues would you need to consider?Dimitri Designs has capacity to produce 30,000 desk chairs per year and is currently selling all 30,000 for $240 each. Country Enterprises has approached Dimitri to buy 800 chairs for $210 each. Dimitris normal variable cost is $165 per chair, including $50 per unit in direct labor per chair. Dimitri can produce the special order on an overtime shift, which means that direct labor would be paid overtime at 150% of the normal pay rate. The annual fixed costs will be unaffected by the special order and the contract will not disrupt any of Dimitris other operations. What will be the impact on profits of accepting the order?
- Sara Pacheco is a sophomore in college and earns a little extra money by making beaded key ring accessories. She sells them on Saturday mornings at the local flea market. Sara charges 5 per unit and has unit variable costs (beads, wire rings, etc.) of 2. Her fixed costs consist of small pliers, a glue gun, etc., which cost her 90. Required: 1. Calculate Saras break-even units. 2. Prepare a profit-volume graph for Sara. 3. Prepare a cost-volume-profit graph for Sara.Polaris Inc. manufactures two types of metal stampings for the automobile industry: door handles and trim kits. Fixed cost equals 146,000. Each door handle sells for 12 and has variable cost of 9; each trim kit sells for 8 and has variable cost of 5. Required: 1. What are the contribution margin per unit and the contribution margin ratio for door handles and for trim kits? 2. If Polaris sells 20,000 door handles and 40,000 trim kits, what is the operating income? 3. How many door handles and how many trim kits must be sold for Polaris to break even? 4. CONCEPTUAL CONNECTION Assume that Polaris has the opportunity to rearrange its plant to produce only trim kits. If this is done, fixed costs will decrease by 35,000, and 70,000 trim kits can be produced and sold. Is this a good idea? Explain.Variety Artisans has a bottleneck in their production that occurs within the engraving department. Arjun Naipul, the COO, is considering hiring an extra worker, whose salary will be $45,000 per year, to solve the problem. With this extra worker, the company could produce and sell 3,500 more units per year. Currently, the selling price per unit is $18 and the cost per unit is $5.85. Using the information provided, calculate the annual financial impact of hiring the extra worker.
- Cadre, Inc., sells a single product with a selling price of $120 and variable costs per unit of $90. The companys monthly fixed expenses are $180,000. What is the companys break-even point in units? What is the companys break-even point in dollars? Prepare a contribution margin income statement for the month of October when they will sell 10,000 units. How many units will Cadre need to sell in order to realize a target profit of $300,000? What dollar sales will Cadre need to generate in order to realize a target profit of $300,000? Construct a contribution margin income statement for the month of August that reflects $2,400,000 in sales revenue for Cadre, Inc.Joey Bag-o-donuts owns an ice cream shop. Looking at last year's utility bills, the highest utility bill was $4000 for 2000 machine hours. The lowest utility bill was $2500 for 1200 machine hours. Calculate the variable rate per machine hour and the total fixed utility cost. Show the equation for determining total utility costs. If Joey plans on using 1500 machine hours, what will the total utility bill be using the equation in part 2.To pay for his academic fees, Tarek, a college student, is selling a computer accessory to other students. His cost to purchase each piece is $70, and he is planning to sell the accessories for $104each. Fixed costs for advertising amount to $350. (a) Compute the contribution margin. (b) Compute the contribution rate. (c) Compute the break-even point in units. (d) Compute the break-even point in sales dollars.