18 Jun HOW MANY BOXES OF CHOCOLATES MUST PALMER’S GOURMET CHOCOLATES SELL TO BREAKEVEN?
Directions: Your assignment this week is to answer the below three questions. Please note that question #1 has 2 parts, part a and part b and question #2 has 3 parts, part a, part b and part c. Please show your work for full credit and use the box provided. Please add more rows or columns to the box if needed.
1. Palmer’s Gourmet Chocolates produces and sells assorted boxed chocolates. The unit selling price is $50, unit variable costs are $25, and total fixed costs are $2,000.
1a. How many boxes of chocolates must Palmer’s Gourmet Chocolates sell to breakeven?
1b. What are breakeven sales in dollars?
2. Extreme Sports received a special order for 1,000 units of its extreme motorbike at a selling price of $250 per motorbike. Extreme Sports has enough extra capacity to accept the order. No additional selling costs will be incurred. Unit costs to make and sell this product are as follows: Direct materials, $100; direct labor, $50; variable manufacturing overhead, $14; fixed manufacturing overhead, $10, and variable selling costs, $2.
2a. List the relevant costs.
2b. What will be the change in operating income if Extreme Sports accepts the special order?
2c. Should Extreme Sports accept the special order? Why or why not?
3. Totally Technology manufactures Cameras and Video Recorders. The company’s product line income statement follows:
Camera Video Recorder Total
Sales revenue $300,000 $100,000 $400,000
Cost of goods sold
Variable $75,000 $49,000 $124,000
Fixed $82,000 $28,000 $110,000
Total cost of goods sold $157,000 $77,000 $234,000
Gross profit $143,000 $23,000 $166,000
Marketing and administrative expenses
Variable $25,000 $28,000 $53,000
Fixed $32,000 $19,000 $51,000
Total marketing and administrative expenses $57,000 $47,000 $104,000
Operating income (loss) $86,000 (24,000) $62,000
Management is considering discontinuing the Video Recorder product line. Accountants for the company estimate that discontinuing the Video Recorder line will decrease fixed cost of goods sold by $10,000 and fixed marketing and administrative expenses by $4,000.
Prepare an analysis supporting your opinion about whether or not the Video Recorder product line should be discontinued.
ORDER THIS PAPER NOW AND GET AN AMAZING DISCOUNT.
Our website has a team of professional writers who can help you write any of your homework. They will write your papers from scratch. We also have a team of editors just to make sure all papers are of HIGH QUALITY & PLAGIARISM FREE. To make an Order you only need to click Ask A Question and we will direct you to our Order Page at WriteDemy. Then fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Fill in all the assignment paper details that are required in the order form with the standard information being the page count, deadline, academic level and type of paper. It is advisable to have this information at hand so that you can quickly fill in the necessary information needed in the form for the essay writer to be immediately assigned to your writing project. Make payment for the custom essay order to enable us to assign a suitable writer to your order. Payments are made through Paypal on a secured billing page. Finally, sit back and relax.
About Writedemy
We are a professional paper writing website. If you have searched a question and bumped into our website just know you are in the right place to get help in your coursework. We offer HIGH QUALITY & PLAGIARISM FREE Papers.
How It Works
To make an Order you only need to click on “Order Now” and we will direct you to our Order Page. Fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Are there Discounts?
All new clients are eligible for 20% off in their first Order. Our payment method is safe and secure.