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1. Texas Co. expects gross sales of 20,000 models of S1 in September. DX1 is its hottest excessive efficiency desktop mannequin. The gross sales supervisor is assured that, between October and December, the overall gross sales may have a 40% progress fee every month from the month earlier than. Every unit requires 30 units of micro chip. The agency has a coverage to keep up stock on the finish of every month equal to 20% of the next month’s estimated gross sales. The identical coverage applies additionally to the micro chips and parts required to assemble the completed product.
Required:
1. What’s the budgeted manufacturing (in models) for every of the months September, October, and November?
2. What number of units of micro chip does the corporate plan to buy in September and in October?
2. Texas Co. established the next overhead value swimming pools and value drivers:
Budgeted Estimated Overhead Value Pool Overhead Value Driver Value Driver Stage Quality control $780,000 # of inspections 26,000 inspections Machine setups $720,000 # of setups 12,000 setups Different overhead prices $900,000 # of machine hrs 50,000 machine hrs Complete overhead prices $2,400,000 A latest order for sailboats used: High quality inspections 750 inspections Machine setups 500 setups Machine hours (MHs) 2,400 machine hours
Required:
a. What’s the overhead fee per machine hour if the variety of machine hours (MHs) is used as a single value driver below conventional costing system?
b. Using conventional costing, how a lot overhead is assigned to the order based mostly on machine hours as a single value driver?
c. Using ABC, how a lot whole overhead is assigned to the order?
three. Texas Co. plans to provide and promote digital merchandise. The projected information for producing its merchandise are as follows: Budgeted gross sales (in models) three,000 Promoting worth per unit $60 Variable prices per unit $36 Complete mounted prices $40,000 Revenue tax fee 30% Desired income after tax $35,000 Required) Please reply the next questions and present all of your works (components and numbers) to get full credit.
a. What are the contribution margin per unit and CM ratio?
b. What number of models (per yr) would it not have to provide with the intention to break even?
c. To earn the will after-tax income, what number of models would it not should promote/produce?
d. Calculate the margin of security ratio within the budgets quantities are offered. Outline what is supposed by the MOS.
e. Calculate the diploma of working leverage if the budgets quantity are offered. Outline what is supposed by the DOL.
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