Two products use a constrained machine hour resource. Produc…

Two products use a constrained machine hour resource. Product A has contribution margin $18 per unit and requires 0.6 machine hours per unit. Product B has contribution margin $14 per unit and requires 0.3 machine hours per unit. If machine hours are limited, which product provides the higher contribution margin per machine hour?

Northline Snacks sells 180,000 cases per quarter but has cap…

Northline Snacks sells 180,000 cases per quarter but has capacity for 220,000 cases. Normal unit data: selling price $28; variable manufacturing cost $16; variable selling cost $5. A special order is offered for 25,000 cases at $20 each. For this order, variable selling costs will be $2 per case (special shipping is required, but commissions are avoided). Fixed costs do not change. What is the impact on quarterly operating income if the order is accepted?

Larch Furniture can sell an unfinished coffee table for $85….

Larch Furniture can sell an unfinished coffee table for $85. If it is finished, it can be sold for $103. Additional finishing costs per table are: materials $4, labour $6, and variable overhead equal to 50% of incremental labour cost. Fixed costs do not change. What is the incremental impact on income per table if the company finishes the tables?

A joint process produces Product J. At the split-off point,…

A joint process produces Product J. At the split-off point, Product J can be sold for $210,000 or processed further and sold for $248,000. Additional processing costs are $34,000. Joint costs incurred before split-off are unavoidable. What should management do for Product J, and what is the impact on income?

Canyon Gear operates at full capacity making 50,000 units pe…

Canyon Gear operates at full capacity making 50,000 units per month. Normal unit data: selling price $40; variable manufacturing cost $22; variable selling cost $4. A special order for 6,000 units is offered at $33 each. The order would not require any variable selling costs. Accepting the order would reduce regular sales by 6,000 units. What is the impact on monthly operating income if the special order is accepted?