Required information Problem 7-49 CVP; Multiple Products; Changes in Costs and Sales Mix (LO 7-4, 7-5) [The following information applies to the questions displayed below] Cincinnati Tool Company (CTC) manufactures a line of electric garden tools that are sold in general hardware stores. The company's controller, Will Fulton, has just received the sales forecast for the coming year for CTC's three products: hedge clippers, weeders, and leaf blowers. CTC has experienced considerable variations in sales volumes and variable costs over the past two years, and Fulton belleves the forecast should be carefully evaluated from a cost-volume-profit viewpoint. The preliminary budget information for 20x2 follows: Unit sales Unit selling price Variable manufacturing cost per unit Variable selling cost per unit Weeders 50,000 $ Weeders Hedge Clippers Leaf Blowers Total 28 13 5 Product Line Sales units units units units Hedge Clippers 50,000 36 $ 12 4 For 20x2, CTC's fixed manufacturing overhead is budgeted at $2,000,000, and the company's fixed selling and administrative expenses are forecasted to be $600,000. CTC has a tax rate of 40 percent. Leaf Blower's 100,000 $ 48 25 6 Problem 7-49 Part 2 2. Assuming the sales mix remains as budgeted, determine how many units of each product CTC must sell In order to break even in 20x2. (Do not round Intermediate calculations.)
Required information Problem 7-49 CVP; Multiple Products; Changes in Costs and Sales Mix (LO 7-4, 7-5) [The following information applies to the questions displayed below] Cincinnati Tool Company (CTC) manufactures a line of electric garden tools that are sold in general hardware stores. The company's controller, Will Fulton, has just received the sales forecast for the coming year for CTC's three products: hedge clippers, weeders, and leaf blowers. CTC has experienced considerable variations in sales volumes and variable costs over the past two years, and Fulton belleves the forecast should be carefully evaluated from a cost-volume-profit viewpoint. The preliminary budget information for 20x2 follows: Unit sales Unit selling price Variable manufacturing cost per unit Variable selling cost per unit Weeders 50,000 $ Weeders Hedge Clippers Leaf Blowers Total 28 13 5 Product Line Sales units units units units Hedge Clippers 50,000 36 $ 12 4 For 20x2, CTC's fixed manufacturing overhead is budgeted at $2,000,000, and the company's fixed selling and administrative expenses are forecasted to be $600,000. CTC has a tax rate of 40 percent. Leaf Blower's 100,000 $ 48 25 6 Problem 7-49 Part 2 2. Assuming the sales mix remains as budgeted, determine how many units of each product CTC must sell In order to break even in 20x2. (Do not round Intermediate calculations.)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints
Section: Chapter Questions
Problem 17E
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![Required information
Problem 7-49 CVP; Multiple Products; Changes in Costs and Sales Mix (LO 7-4, 7-5)
[The following information applies to the questions displayed below]
Cincinnati Tool Company (CTC) manufactures a line of electric garden tools that are sold in general hardware stores. The
company's controller, Will Fulton, has just received the sales forecast for the coming year for CTC's three products: hedge
clippers, weeders, and leaf blowers. CTC has experienced considerable variations in sales volumes and variable costs
over the past two years, and Fulton belleves the forecast should be carefully evaluated from a cost-volume-profit
viewpoint. The preliminary budget information for 20x2 follows:
Unit sales
Unit selling price
Variable manufacturing cost per unit
Variable selling cost per unit
Weeders
Hedge Clippers
Leaf Blowers
Total
Weeders
50,000
$
Product Line Sales
units
units
28
13
5
For 20x2, CTC's fixed manufacturing overhead is budgeted at $2,000,000, and the company's fixed selling and
administrative expenses are forecasted to be $600,000. CTC has a tax rate of 40 percent.
units
units
Hedge Clippers
50,000
36
$
12
4
Problem 7-49 Part 2
2. Assuming the sales mix remains as budgeted, determine how many units of each product CTC must sell In order to break even in
20x2. (Do not round Intermediate calculations.)
Leaf Blower's
100,000
$ 48
25
6](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F0875e4fe-3b78-4b23-980f-fc460904235e%2F1cc358f5-bb3f-42ad-aa16-838661386d16%2Fb8v6cuo_processed.png&w=3840&q=75)
Transcribed Image Text:Required information
Problem 7-49 CVP; Multiple Products; Changes in Costs and Sales Mix (LO 7-4, 7-5)
[The following information applies to the questions displayed below]
Cincinnati Tool Company (CTC) manufactures a line of electric garden tools that are sold in general hardware stores. The
company's controller, Will Fulton, has just received the sales forecast for the coming year for CTC's three products: hedge
clippers, weeders, and leaf blowers. CTC has experienced considerable variations in sales volumes and variable costs
over the past two years, and Fulton belleves the forecast should be carefully evaluated from a cost-volume-profit
viewpoint. The preliminary budget information for 20x2 follows:
Unit sales
Unit selling price
Variable manufacturing cost per unit
Variable selling cost per unit
Weeders
Hedge Clippers
Leaf Blowers
Total
Weeders
50,000
$
Product Line Sales
units
units
28
13
5
For 20x2, CTC's fixed manufacturing overhead is budgeted at $2,000,000, and the company's fixed selling and
administrative expenses are forecasted to be $600,000. CTC has a tax rate of 40 percent.
units
units
Hedge Clippers
50,000
36
$
12
4
Problem 7-49 Part 2
2. Assuming the sales mix remains as budgeted, determine how many units of each product CTC must sell In order to break even in
20x2. (Do not round Intermediate calculations.)
Leaf Blower's
100,000
$ 48
25
6
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