Ch13 Homework Assignment W24

Reduced 5%
increase 5%
Target Operative Income = Capital Invested X
283200 1180000
Target operating income $283,200

+ Total fixed costs 399,000
Total target contribution margin $682,200
/ Room-nights 22,800
target contribution margin per room-night $29.92
Price Per room- Night target contribution+

38.4210526315789 $29.92
Fixed Cost Per Room-night Total Fixed Cost /

17.5 399,000
Full Cost of a Room Night Variable cost per r +

26 8.5
Mark Up as a % of full cost Mark up per room n/

47.7732793522267 12.421052631579
New Contribution margin New Price per roo -

670320 36.5
Contribution Margin Price per room -

682200 38.421052631579
Target Retunr on Investment
0.24
Variable Cost per Romm -night

8.5
Total Room-Night
22,800
Fixed Cost per room night

17.5
Full Cost of a Room Night

26
variable cost per room x New number of rooms rented

8.5 23940
variable cost X Number of rooms rented

8.5 22,800
cost per unit 2021 2022
Direct materials $1,350 $1,300
Batch-level costs 203 221.142857142857
Manuf. operations costs 268 256
Engineering change costs 40 28
Total $1,861 $1,805
% Reduction 4%
2021
Batch-level costs Cost per Batch X Number of Batches / Unito Produced
203.428571428571 $8,900 80 3,500
2021 Manu Op Cost per Unit Cost per Mac Ho x Num. of Mac Hours /Unit Produced
268 67 14,000 3,500
2021 Eni Change Cost Cost per Eng Chax Number of changes /Unit Produced
40 7,000 20 3,500
2022
Batch-level costs Cost per Batch X Number of Batches / Unito Produced
221.142857142857 $8,600 90 3,500
2021 Manu Op Cost per Unit Cost per Mac Ho x Num. of Mac Hours /Unit Produced
256 64 14,000 3,500
2021 Eni Change Cost Cost per Eng Chax Number of changes /Unit Produced
28 12,250 8 3,500
Target Manuf. Cost per Unit Man. Cost per Unx Target Ratio
1786.56 $1,861 96%
Actual Results for 2021 Actual Results for 2022
Units of HJ6 produced 3,500 3,500
Direct material cost per u $1,350 $1,300
Total number of batches 80 90
Total machine-hours requ 14,000 14,000
Number of engineering 20 8
Setup, production order, $8,900 $8,600

Total manufacturing-oper 67 64
Cost per engineering cha 7,000 12,250
Total fixed costs over four years Variable cost per unit
Year 1 R&D costs $7,120,000 —
Year 1 Design costs 1,680,000 —
Years 2-4 Production 20,400,000 36
Years 2-4 Marketing and distribution 6,150,000 9
Years 2-4 Customer service 2,300,000 —
Total $37,650,000 $45
Yew Game System 90 per Unit

a) SELL THE YEW 90 Expected Sell
b) Boost Selling 100 Expected Sell
drop to 90
Year 3 Sell 245,000
YEAR 4 SELL 60,000
Break Even in Unit Fixed Cost/ (selling price per unit

836667 $37,650,000 90
Projected Life Cycle Statement of Comprehensive Income

Revenues $142,200,000
Variable costs 71,100,000
Fixed costs 37,650,000
Life cycle operating income (loss) $33,450,000
Selling price x
Year 2 $100 x
Years 3 and 4 $90 x
Total
Projected Life Cycle Statement of Comprehensive Income

Revenues $129,450,000
Variable costs 59,625,000
Fixed costs 37,650,000
Life cycle operating income (loss) $32,175,000
per unit
per unit
1580000
1020000
- Variable cost per unit)

$45
Number of
= Revenue
units sold
1,020,000 = $102,000,000
305,000 = $27,450,000
$129,450,000
Number of Seats Expected to Be Sold
Price Charged Variable Cost per Ticket Business Pleasure
$700 $70 230 115
2,200 190 220 45
Assume that round trip fuel cost are fixed cost 24900
fixed costs allocated to theround-trip flight forairplane- Total contribution m

lease costs, groundservices, andflight-crew salaries total 183000
Price charged
$700
2,200
Number
Contribution margin× of passengers
Business $630 230
Pleasure $630 115
Number
Contribution margin× of passengers
Business $2,010 220
Pleasure $2,010 45
# of passengers
at price
[1-( $2,100 /
level:
Business [1-( 220 /
Pleasure [1-( 45 /
Total contribution margin
Business Pleasure
$144,900 $72,450
$442,200 $90,450
Total
=contribution margin
$144,900
$72,450
Total
=contribution margin
$442,200
$90,450
# of passengers Percent
at price )]x
$800 Changed
level: 100% =
) ] x 100%
230 4.347826087 %
=
) ] x 100%
115 60.86956522 %
=

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Reduced 5%

Target operating income $283,200

Price Per room- Night target contribution+

Fixed Cost Per Room-night Total Fixed Cost /

Full Cost of a Room Night Variable cost per r +

Mark Up as a % of full cost Mark up per room n/

New Contribution margin New Price per roo -

Contribution Margin Price per room -

Variable Cost per Romm -night

Fixed Cost per room night

Full Cost of a Room Night

variable cost per room x New number of rooms rented

variable cost X Number of rooms rented

Setup, production order, $8,900 $8,600

Yew Game System 90 per Unit

Break Even in Unit Fixed Cost/ (selling price per unit

Projected Life Cycle Statement of Comprehensive Income

Projected Life Cycle Statement of Comprehensive Income

- Variable cost per unit)

fixed costs allocated to the​round-trip flight for​airplane- Total contribution m

Business [1-( 220 /

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fixed costs allocated to theround-trip flight forairplane- Total contribution m