The Walton Toy Company manufactures a line of dolls and a doll dress sewing kit.
ID: 2388662 • Letter: T
Question
The Walton Toy Company manufactures a line of dolls and a doll dress sewing kit. Demand for the dolls 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:
The company's plant has a capacity of 106,650 direct labor-hours per year on a single-shift basis. The company's present employees and equipment can produce all five products.
Determine the contribution margin per direct labor-hour expended on each product. (Round your answers to 2 decimal places.)
The Walton Toy Company manufactures a line of dolls and a doll dress sewing kit. Demand for the dolls 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:
Explanation / Answer
Direct labor
Products
Direct
hours per unit
labor cost
Cost /12
$5.40
=5.4/12
0.45
Trish
$2.40
=2.4/12
0.2
Sarah
$9
=9/12
0.75
Mike
$5.40
=5.4/12
0.45
Sewing kit
$1.20
=1.2/12
0.1
Variable
Total variable
Selling
Labor hour
Contribution margin
Products
Materials
Labor
Overhead
cost per unit
Price
Per unit
per labor hour
3.9
5.4
3
12.3
38
0.45
57.11
2.2
2.4
3
7.6
24
0.2
82.00
5.3
9
3
17.3
25
0.75
10.27
3.3
5.4
3
11.7
19
0.45
16.22
1
1.2
3
5.2
17
0.1
118.00
Determination of direct labor hours per unit:Direct labor
Products
Direct
hours per unit
labor cost
Cost /12
Debbie$5.40
=5.4/12
0.45
Trish
$2.40
=2.4/12
0.2
Sarah
$9
=9/12
0.75
Mike
$5.40
=5.4/12
0.45
Sewing kit
$1.20
=1.2/12
0.1
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