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| Topic: |
Business
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| Number of pages / Number of words: |
5 / 1125 |
Essay's paper body
The question is how well the prices cover the direct and indirect allocated costs?
Current prices analysis detected the following:
Patterned glasses Paperweights Wrapped tumblers Vases
Selling Price $9.00 $15.00 $8.00 $25.00
Direct Variable Costs:
Direct Labor 7.50 12.50 7.50 12.50
Direct Materials 0...
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The Vases line is the only one that provides descent profitability. The other lines’ prices are not sufficient to cover operating costs.
Under current prices with the current sales mix, it will going to more than double monthly production to cover just a fixed operating costs:
Patterned glasses Paperweights Wrapped tumblers Vases Total per Bundle
Expected Monthly Sales, Units 78 43 130 30 282
Selling Price $9...
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