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Question: Multiproduct firm The Glass Menagerie makes small, pressed-resin ducks and ducklings. They are so…
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Multiproduct firm

The Glass Menagerie makes small, pressed-resin ducks and
ducklings. They are sold as sets containing one duck and five
ducklings. The following information is available about the
company’s selling prices and cost:

Ducks Ducklings
Selling price $25 $13
Variable cost 11 9
Annual fixed cost $310,080

Use the contribution margin ratio to calculate break even point
sales.

a. What is the average contribution margin
ratio? Round your answer to one decimal place.
%

b. Calculate the monthly break-even point if
fixed cost is incurred evenly throughout the year.
sets per month

At the BEP, indicate how many units of each product will be sold
monthly.

Ducks per month
Ducklings per month

c. If the company wants to earn $100,640
pre-tax profit monthly, how many units of each product must it
sell?

Ducks per month
Ducklings per month

d. Company management has specified $33,996 as
monthly net income, and the company is in a 40 percent tax bracket.
However, marketing information has indicated that the sales mix has
changed to one duck to nine ducklings. How much total revenue and
what number of products must be sold to achieve the company’s
profit objective?

Total revenue $
Ducks Units
Ducklings Units

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