Twinkie Trivia Co. manufactures and sells two trivia products, the Square Trivia Game and the Round...
- Twinkie Trivia Co. manufactures and sells two trivia products,
the Square Trivia Game and the Round Trivia Game. Last quarter’s
operating profits, by product, and for the company as a whole, were
as follows:
|
Square |
Round |
|
|
Sales revenue |
$ 12,000 |
$ 5,000 |
|
Variable expenses |
$ 3,000 |
$ 3,250 |
|
Contribution margin |
$ 9,000 |
$ 1,750 |
|
Fixed expenses |
$ 3,000 |
$ 4,375 |
|
Operating income |
$ 6,000 |
$ (2,625) |
Twenty percent of the Round Game’s fixed costs could have
been avoided if the game had not been produced or sold. If the
Round Game had been discontinued before the last quarter, what
would operating income have been for the company as a
whole?
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Twinkie Trivia Co. manufactures and sells two trivia products,
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Product
Basic
Deluxe
Total
Sales
$
600,000
$
400,000
$
1,000,000
Contribution margin ratio
60
%
35
%
?
Contribution margin per unit
$
9.00
$
11.50
?
The company’s fixed expenses total $400,000 per month.
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products are shown below:
Product
Basic
Deluxe
Total
Sales
$
600,000
$
400,000
$
1,000,000
Contribution margin ratio
60
%
35
%
?
Contribution margin per unit
$
9.00
$
11.50
?
The company’s fixed expenses total $400,000 per month.
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