Incremental Revenue = Revenue after reduction – Revenue before reduction
= 307,500*3.65 – 250,000*4
= $122,375
Incremental cost = Variable cost = (16000+9000)*57,500/20,000 = $71,875
Incremental Income = $50,500
Question 7 (1 point) Consider the production cost information for Mama Italiano Sauce given below: Mama...
Question 6 (1 point) Saved Consider the production cost information for Mama Italiano Sauce given below: Mama Italian Sauce Production Cost Budget April 2008 Production - Jars of sauce 20,000 Ingredient cost (variable) $16,000 Labor cost (variable) 9.000 Rent (fixed) 4,000 Depreciation (fixed) 6,000 Other (fixed) 1.000 Total $36,000 The company is currently producing and selling jars of sauce The jars of sauce sell for $4 per jar. The company is considering lowering the price to $3.70 per jar. Suppose...
Question 5 (1 point) Mama Italiano Sauce is in the process of preparing a production cost budget for May. The actual costs in April were: Mama Italian Sauce Production Cost Budget April 2008 Production - Jars of sauce 20,000 Ingredient cost (variable) $16.000 Labor cost (variable) 9.000 Rent (fixed) 4.000 Depreciation (fixed) 6,000 1,000 Other (fixed) Total $36.000 Using this information, prepare a budget for May stating the total amount for the May budget. Assume the budget will increase to...
Question 3 (1 point) Triton Company's copy department, which does almost all of the photocopying for the sales department and the administrative department, budgets the following costs for the year, based on the expected activity of copies: Salaries (fixed) $82,000 Employee benefits (fixed) 10,000 Depreciation of copy machines (fixed) 10,000 Utilities (fixed) 5,000 Paper (variable, 1 cent per copy) 50,000 Toner (variable, 1 cent per copy) 50,000 The costs are assigned to two cost pools, one for fixed and one...
CELX PROBLEM 1-2. Incremental Analysis [LO 2, 3] Consider the production cost information for Santiago's Salsa in Problem 1-1. The company is currently producing and selling 325,000 jars of salsa annually. The jars sell for $5.00 each. The company is considering lowering the price to $4.60. Suppose this action will increase sales to 375,000 jars. REQUIRED a. What is the incremental cost associated with producing an extra 50,000 jars of salsa? b. What is the incremental revenue associated with the...
Required information Cost Classifications (Algo) [The following information applies to the questions displayed below.] Kubin Company's relevant range of production is 12,000 to 16,000 units. When it produces and sells 14,000 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost per Unit $7.30 $4.30 $1.80 $5.30 $3.80 $2.80 $1.30 $0.80 Exercise 1-10 (Algo) Differential Costs and Sunk...
Required information Cost Classifications (Algo) [The following information applies to the questions displayed below.] Kubin Company's relevant range of production is 12,000 to 16,000 units. When it produces and sells 14,000 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average cost per Unit $7.30 $4.30 $1.80 $5.30 $3.80 $2.80 $1.30 $0.80 Exercise 1-10 (Algo) Differential Costs and Sunk...
QUESTION 26 Dragon Fire Hot Sauce makes two types of hot sauces-meek and mild. Budgeted information for the two flavors appears below: Meek Mild Sales $600,000 $400,000 Direct materials $100,000 $120,000 Direct labor cost $108,000 $180,000 Labor hourly cost $12.00 $12.00 The company estimates it will incur $345,600 in overhead costs for the period, Dragon Fire allocates overhead cost to products based on the labor hours worked on each product. How much is the total overhead applied to Meek? O...
Question 2: Morrisroe Corporation has provided the following information: Cost per UnisCost per Period $765 Direct materials Direct labor 4.30 Variable manufacturing overhead Fixed manufacturing overhead Sales commissions $1.50 $1,000 S1.50 Variable administrative expense S1.00 Fixed selling and administrative expense $5,00 Required a. If the selling price is $35 per unit, what is the contribution margin per unit sold? (2 marks) b. What incremental manufacturing cost will the company incur if it increases production from 5,000 to 5,010 units? (2...
The following information applies to the questions displayed below.) Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $516 each Costs 1. Plastic for casing-$19.000 2. Wages of assembly workers-590,000 3. Property taxes on factory-$7,000 4. Accounting staff salaries--$33,000 5. Drum stands (1.000 stands purchased)-$35,000 6. Rent cost of equipment for sales staff-$36.000 7. Upper management salaries-$170,000 8. Annual flat fee for factory maintenance service-$16,000 9. Sales...
1) Consider the following cost and production informatio wing cost and production information for Barnard Steel Building Company, Inc, Part C-2472 Part D-1340 All other parts Quantity 1140 Subtotal Average Subtotal Average unit Subtotal Average unit Direct costs Material cout $ 150,000 $ 250 $ 405.000 $ 33755 2,446,440 2,146 Convenio cost 72,000 500 129.000 1075 974.700 855 Total direct costs $ 252,000 $ 1,750 $ 534000 $ 4,450 3,421,140 3,001 Indirect coute Indirect production cost 385,500 6,150 738,000 6,150...