Question

Problem 18-5A (Part Level Submission) Viejol Corporation has collected the following information after its first year...

Problem 18-5A (Part Level Submission)

Viejol Corporation has collected the following information after its first year of sales. Sales were $1,600,000 on 100,000 units, selling expenses $200,000 (40% variable and 60% fixed), direct materials $508,000, direct labor $290,400, administrative expenses $278,000 (20% variable and 80% fixed), and manufacturing overhead $380,000 (70% variable and 30% fixed). Top management has asked you to do a CVP analysis so that it can make plans for the coming year. It has projected that unit sales will increase by 10% next year.

(a)

Compute (1) the contribution margin for the current year and the projected year, and (2) the fixed costs for the current year. (Assume that fixed costs will remain the same in the projected year.)
(1) Contribution margin for current year $
Contribution margin for projected year $
(2) Fixed Costs $
Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
Total cost Variable cost Fixed cost
Selling expense 200000 80000 120000
Direct materials 508000 508000 0
Direct labor 290400 290400 0
Administrative expense 278000 55600 222400
Manufacturing overhead 380000 266000 114000
Total 1656400 1200000 456400
(a)
(1)
Contribution margin for current year = Sales - Total variable cost = 1600000 - 1200000 400000
Contribution margin for projected year = Contribution margin for current year * ( 1 + 10% ) = 400000 * ( 1 + 10% ) 440000
(2)
Fixed costs 456400
0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Problem 18-5A Mozena Corporation has collected the following information after its first year of sales. Sales...
Problem 18-5A Mozena Corporation has collected the following information after its first year of sales. Sales were $1,500,000 on 100,000 units; selling expenses $250,000 (40% variable and 60% fixed); direct materials $511,000; direct labor $290,000; administrative expenses $270,000 (20% variable and 80% fixed); manufacturing overhead $350,000 (70% variable and 30% fixed). Top management has asked you to do a CVP analysis so that it can make plans for the coming year. It has projected that unit sales will increase by...
Crane Corporation has collected the following information after its first year of sales. Sales were $1,600,000...
Crane Corporation has collected the following information after its first year of sales. Sales were $1,600,000 on 100,000 units, selling expenses $240,000 (40% variable and 60% fixed), direct materials $514,000, direct labor $270,800, administrative expenses $280,000 (20% variable and 80% fixed), and manufacturing overhead $376,000 (70% variable and 30% fixed). Top management has asked you to do a CVP analysis so that it can make plans for the coming year. It has projected that unit sales will increase by 10%...
iejol Corporation has collected the following information after its first year of sales. Sales were $1,200,000...
iejol Corporation has collected the following information after its first year of sales. Sales were $1,200,000 on 100,000 units, selling expenses $210,000 (40% variable and 60% fixed), direct materials $492,000, direct labor $21,000, administrative expenses $276,000 (20% variable and 80% fixed), and manufacturing overhead $354,000 (70% variable and 30% fixed). Top management has asked you to do a CVP analysis so that it can make plans for the coming year. It has projected that unit sales will increase by 10%...
                Problem 22-5A (Part Level Submission) Optimus Company manufactures a variety of tools and industrial equipment....
                Problem 22-5A (Part Level Submission) Optimus Company manufactures a variety of tools and industrial equipment. The company operates through three divisions. Each division is an investment center. Operating data for the Home Division for the year ended December 31, 2017, and relevant budget data are as follows. Actual Comparison with Budget Sales                                                                                     $1,400,000                           $101,000              favorable Variable cost of goods sold                                           675,000                                 55,000   unfavorable Variable selling and administrative expenses                       126,000                                 25,000   unfavorable Controllable fixed cost of...
Problem 22-03A (Part Level Submission) Blossom Company bottles and distributes B-Lite, a diet soft drink. The...
Problem 22-03A (Part Level Submission) Blossom Company bottles and distributes B-Lite, a diet soft drink. The beverage is sold for 50 cents per 16-ounce bottle to retailers, who charge customers 75 cents per bottle. For the year 2020, management estimates the following revenues and costs. Sales $1,950,000 Selling expenses—variable $67,000 Direct materials 550,000 Selling expenses—fixed 61,000 Direct labor 350,000 Administrative expenses—variable 28,000 Manufacturing overhead—variable 370,000 Administrative expenses—fixed 59,250 Manufacturing overhead—fixed 260,000 (a) Prepare a CVP income statement for 2020 based...
Problem 3-38 (Part Level Submission) Sandhill Company produces a molded briefcase that is distributed to luggage...
Problem 3-38 (Part Level Submission) Sandhill Company produces a molded briefcase that is distributed to luggage stores. The following operating data for the current year has been accumulated for planning purposes. Sales price $41.00 Variable cost of goods sold 13.00 Variable selling expenses 11.60 Variable administrative expenses 4.00 Annual fixed expenses    Overhead $17,347,200    Selling expenses 3,447,200    Administrative expenses 7,228,000 Sandhill can produce 3,336,000 cases a year. The projected net income for the coming year is expected to be $4,003,200. Sandhill...
Problem D2-25 (Part Level Submission) J Crane, Ltd. is a local coat retailer. The store’s accountant...
Problem D2-25 (Part Level Submission) J Crane, Ltd. is a local coat retailer. The store’s accountant prepared the following income statement for the month ended January 31: Sales revenue $ 750,000 Cost of goods sold 300,000 Gross margin 450,000 Operating expenses   Selling expense $ 23,560   Administrative expense 49,500 73,060 Net operating income $ 376,940 Crane sells its coats for $250 each. Selling expenses consist of fixed costs plus a commission of $6.50 per coat. Administrative expenses consist of fixed costs...
Pharoah Company produces a molded briefcase that is distributed to luggage stores. The following operating data...
Pharoah Company produces a molded briefcase that is distributed to luggage stores. The following operating data for the current year has been accumulated for planning purposes. Sales price $41.17 Variable cost of goods sold 13.17 Variable selling expenses 11.77 Variable administrative expenses 4.17 Annual fixed expenses Overhead $14,040,000 Selling expenses 2,790,000 Administrative expenses 5,850,000 Pharoah can produce 2,700,000 cases a year. The projected net income for the coming year is expected to be $3,240,000. Pharoah is subject to a 40%...
Use below information for Questions 18 to 20: Company X has collected the following information after...
Use below information for Questions 18 to 20: Company X has collected the following information after its first year of sales. Sales were TL1,650,000 on 100,000 units. Selling expenses were TL275,000 of which 45% was variable. Direct materials were TL490,000 and direct labor were TL290,000. Administrative expenses were TL270,000 of which 20% was variable. MOH was TL387,000 of which 75% was variable. Q-18) Compute contribution margin. Q-19) Calculate breakeven point in TL. Q-20) Calculate units to be sold to achieve...
Problem 8-35A (Part Level Submission) The Daniels Tool & Die Corporation has been in existence for...
Problem 8-35A (Part Level Submission) The Daniels Tool & Die Corporation has been in existence for a little over three years. The company’s sales have been increasing each year as it builds a reputation. The company manufactures dies to its customers’ specifications and therefore uses a job-order cost system. Factory overhead is applied to the jobs based on direct labour hours—the absorption-costing (full) method. Overapplied or underapplied overhead is treated as an adjustment to Cost of Goods Sold. The company’s...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT