Assuming that the company has made optimal use of its 110,050 direct labor-hours, what is the highest direct labor rate per hour that Walton Toy Company would be willing to pay for additional capacity (that is, for added direct labor time)?
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Required: 1. How many direct labor hours are used to manufacture one unit of each of the company's five products? 2. How much variable overhead cost is incurred to manufacture one unit of each of the company's five products? 3. What is the contribution margin per direct labor-hour for each of the company's five products? 4. Assuming that direct labor-hours is the company's constraining resource, what is the highest total contribution margin that the company can earn if it makes optimal use of its constrained resource? 5. Assuming that the company has made optimal use of its 80,520 direct labor-hours, what is the highest direct labor rate per hour that Walton Toy Company would be willing to pay for additional capacity (that is, for added direct labor time)? Complete this question by entering your answers in the tabs below. What is the contribution margin per direct labor-hour for each of the company's five products? (Do not round intermediate calculations. Round your answers to 2 decimal places.) Debbie Trish Sarah Mike Sewing Kit Contribution Margin per DLH $ 53.00 $ 36.33 $ 48.85 $ 11.25 $ 61.57
Sri K.
The Walton Toy Company manufactures a line of dolls and a sewing kit. Demand for the company’s products is increasing, and management requests assistance from you in determining an economical sales and production mix for the coming year. The company has provided the following data: Product Demand Next year (units) Selling Price per Unit Direct Materials Direct Labor Debbie 66,000 $ 37.00 $ 4.30 $ 3.50 Trish 58,000 $ 5.00 $ 1.20 $ 0.84 Sarah 51,000 $ 35.50 $ 8.84 $ 5.60 Mike 37,000 $ 15.00 $ 3.60 $ 4.20 Sewing kit 341,000 $ 9.60 $ 4.80 $ 0.49 The following additional information is available: The company’s plant has a capacity of 115,730 direct labor-hours per year on a single-shift basis. The company’s present employees and equipment can produce all five products. The direct labor rate of $7 per hour is expected to remain unchanged during the coming year. Fixed manufacturing costs total $545,000 per year. Variable overhead costs are $3 per direct labor-hour. All of the company’s nonmanufacturing costs are fixed. The company’s finished goods inventory is negligible and can be ignored. Required: 4. Assuming that direct labor-hours is the company’s constraining resource, what is the highest total contribution margin that the company can earn if it makes optimal use of its constrained resource? 5. Assuming that the company has made optimal use of its 115,730 direct labor-hours, what is the highest direct labor rate per hour that Walton Toy Company would be willing to pay for additional capacity (that is, for added direct labor time)?
Akash M.
A company employs 100 direct workers in the factory, who are paid a basic rate of $5 per hour for a 35 hour week. In addition to working their normal hours last month, each worker was asked to work an additional 5 hours overtime per week to meet general production requirements. All overtime hours are paid at time and a half. As a result of some faulty material, 150 hours of direct labour time were registered as idle. What is the indirect labour cost for last month, assuming a 4 week period? (To the nearest whole number) *
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Principles of Accounting Volume 1: Financial Accounting
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