199 wallace industrial sells two products large

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199) Wallace Industrial sells two products, large forklifts and small forklifts. A large forkliftsells for $50,000 per unit with variable costs of $26,000 per unit. Small forklifts sell for$30,000 per unit with variable costs of $12,000 per unit. Total fixed costs for the companyare $1,600,000. Wallace Industrial typically sells one large forklifts for every two smalls.What is the breakeven point in total units?A) 80 unitsB) 400 unitsC) 30 unitsD) 27 unitsAnswer:AExplanation:A)LargeSmallTotalSales$50,000$30,000Variable Costs26,00012,000Contribution Margin24,00018,000× Sales Mix123Contribution margin$24,000$36,000$60,000Contribution Margin $60,000 / 3 Sales Mix = $20,000 Weighted CMFixed costs $1,600,000 / 20,000 = 80 BE unitsDiff: 2LO:7-4EOC:E7-29AAACSB:Analytical thinkingLearning Outcome:Perform fundamental CVP calculations.96
200) Jackie's Creamery sells fudge, cookies, and popcorn to patrons in the local community.The manager at the creamery sold 12,000 total boxes of merchandise last year. The popcornoutsold fudge by a margin of 2 to 1. The sales of caramels equaled the sales of popcorn.Total fixed costs for Jackie's Creamery total $14,000. The managerial accountant at Jackie'sCreamery reported the following information:ProductUnit Sales PricesUnit Variable CostFudge$5.00$4.00Caramels$8.00$5.00Popcorn$6.00$4.00Which formula should the managerial accountant use to determine the number of boxes ofeach different snack sold?A) 3x + 2x + x = 12,000B) x + y + z = 12,000C) x + 2x + 2x = 12,000D) none of the aboveAnswer:CDiff: 3LO:7-4EOC:E7-30AAACSB:Analytical thinkingLearning Outcome:Perform fundamental CVP calculations.201) Jackie's Creamery sells fudge, caramels, and popcorn to consumers in the localcommunity. The manager at the creamery sold 12,000 units last year. Popcorn outsold fudgeby a ratio of 2 to 1. Sales of caramels equaled sales of popcorn. Total fixed costs for Jackie'sCreamery are $14,000. The managerial accountant reported the following information:ProductUnit Sales PricesUnit Variable CostFudge$5.00$4.00Caramels$8.00$5.00Popcorn$6.00$4.50The sales mix percentage of caramel corn based upon units isA) 20%.B) 40%.C) 75%.D) 44%.Answer:BExplanation:B)Sales Mix: Popcorn 2 + Caramels 2 + Fudge 1 = 5Caramel Corn 2/5= 40%Diff: 2LO:7-4EOC:E7-31AAACSB:Analytical thinkingLearning Outcome:Perform fundamental CVP calculations.97
202) Jackie's Snacks sells fudge, caramels, and popcorn. It sold 12,000 units last year.Popcorn outsold fudge by a margin of 2 to 1. Sales of caramels were the same as sales ofpopcorn. Fixed costs for Jackie's Snacks are $14,000. Additional information follows:ProductUnit Sales PricesUnit Variable CostFudge$5.00$4.00Caramels$8.00$5.00Popcorn$6.00$4.50The weighted average contribution margin for the three products of Jackie's Snacks isA) $11.20.B) $ 0.65.C) $2.00.D) $50.00.Answer:CExplanation:C)FudgeCaramelsPopcornTotalSales$5$8$6Variable Costs454.50Contribution Margin$1$3$1.50× Sales Mix20%40%40%100%Contribution Margin$0.20$1.20$0.60$2.00Diff: 3LO:7-4EOC:E7-31AAACSB:Analytical thinkingLearning Outcome:Perform fundamental CVP calculations.

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Contribution Margin, AACSB, fundamental CVP calculations

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