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4 years ago

What is the key factor in determining sales mix if a company has limited resources?

Business

2 answers:

kirza4 [7]4 years ago

8 0

Answer:

The key factor is the Contribution margin per unit of limited resources.

Explanation:

To begin with, it is important to understand the concept of contribution margin.

Contribution margin is simply the figures arrived at by netting off variable elements of cost against the selling price. That is, a contribution margin is derived when the sales is subjected to variable components of cost that generate it.

Now, we have the Contribution margin per unit of the limited resources. This is simply a study targeted at knowing, per unit basis, an organization's contribution margin. Thus, contribution margin per unit of the limited resources can be derived by dividing the total contribution available with the total number of the limited resources.

That is = Contribution margin/number of limited resources available.

The strategic importance of contribution margin per unit of the limited resources is that, an organization is able to underline its financial performance, and how well it can cater for its fixed cost, after considering the variable elements.

To then determine the effective sales mix, it is important to take a proper look at the contribution margin. A good Sales mix will often have an exerted direct influence on contribution margin. Sales is an integral component is determining the unit contribution of a product. Hence, the key factor in determining the proper and effective sales mix is the contribution margin per unit of limited resources.

Naya [18.7K]4 years ago

6 0

Answer:

Contribution margin per unit of limited resource

Explanation:

When a company has a limited resource on which the generation of income depends, it is to decide that the company cannot generate more income because it does not have more of that resource, for example space in M2 for commercialization or storage, or a manufacturing equipment, it must Investigate what is the contribution margin to the unit of that limited resource and manage the product that has the greatest.

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Stone Foods produces the majority of its cheese products in its U.S. based dairy division at a total outlay cost of $6.00 per un

lubasha [3.4K]

Answer:

Stone Foods produces the majority of its cheese products in its U.S. based dairy division at a total outlay cost of $6.00 per unit. A large portion of the finished product is sold to Division B where it is packaged and sold overseas under a different label. The tax rate in Division B's country is higher than the U.S. tax rate. Assume the company desires to minimize the overall tax impact of the transfer (i) what type of relative pre-tax income should each division desire to achieve as a result of the transfer and (ii) what type of transfer price would accomplish your answer to (i).

Dairy Division Income Division B Income Transfer Price .

Option "D" is the correct answer - High Low High.

Explanation:

Since in Division B, the tax rate is higher than the tax rate in US-based dairy division. Therefore to minimize the impact of the overall tax, transfer price from dairy division should be high to Division B so that the dairy division income would be higher. and the income of Division B would be lower.

Hence option "D" is the correct answer.

3 0

3 years ago

Canadian logging companies sell timber in the United States. To the U.S., the timber is a(n)_____, and for Canadians, the timber

klemol [59]

Answer: import; export

Explanation:

Canadian logging companies sell timber in the United States. To the U.S., the timber is an import, and for Canadians, the timber is an export.

An import is a good that is brought into a country and sold from another country while an export is a good that a country sells to other country. Timber is a export to the United States since it's brought from Canada.

3 0

3 years ago

The process by which management plans, evaluates, and controls investments in fixed assets is called capital investment analysis

rjkz [21]

Answer:

a. True

Explanation:

The process by which management plans, evaluates, and controls investments in fixed assets is called capital investment analysis. This process is also known as capital budgeting.

Generally, capital investment analysis or capital budgeting is used by business firms or governmental agencies to assess and measure the profitability of a long-term investment on a fixed asset such as real estate, machinery or factory equipments etc.

Hence, the management is able to choose the best option for investment after an assessment of which investment would yield a higher level of profits.

8 0

3 years ago

Variable manufacturing overhead incurred was $245,000. Fixed manufacturing overhead incurred was $373,000. Actual machine-hours

steposvetlana [31]

Before information shows is the correct and complete question.

The Lopez Company use a standard costing in its manufacturing plant for the auto part. The standard cost of particular auto part based on a denominator level of a 4.000 output unit per year. included 6 machine-hours of variable manufacturing overhead at $8 per hour and 6 machine-hours of fixed manufacturing overhead at $15 per hour.

Actual output produced was 4.400 units.

Variable manufacturing overhead incurred was $245.000.

Fixed manufacturing overhead incurred was $373.000.

Actual machine-hours were 28.400.

Prepare the analysis of all variable manufacturing overhead and fixed manufacturing overhead variances.

Additional diagram attached to this question is displayed in the first image below.

Answer:

Explanation:

By using a columnar method, the analysis of all the variance & fixed manufacturing overhead varaince can be computed as follows:

Variable manufacturing overhead analysis:

Actual cost Incurred: ║ Actual input × Budgeted ║ Allocated: Budgeted

Actual input × Actual rate Input for actual output

rate × Budgeted rate

245000 28400×$8.00 = 227200 (4400×6hrs×$8)

= 211,200

17800 U 16800 U

Spending Variance Efficiency Variance

33800 U

Flexible Budget Variance

Hence;

The spending Variance = $17,800 U

Efficiency Variance = $16,000 U

Flexible Budget Varaince = $33800 U

where; F = Favourable & U = Unfavourable

<u>For the fixed Manufacturing Overhead:</u>

Actual cost Incurred: ║ Flexible Budget Lump ║ Allocated: Budgeted

Actual input × Actual sum regardless of the Input for actual output

rate output level × Budgeted rate

373000 4000×6hrs×15 = 360000 (4400×6hrs×$15)

= 396000

13000 U 36000 F

Spending Variance/ Production-Volume

Flexible budgeted variance Variance

23000 F

Over allocated fixed

Overhead

Hence;

The spending Variance = $13000 U

The production Volume Variance = $36,000 F

Over allocated fixed overhead = $23000 F

where; F = Favourable & U = Unfavourable

NOTE: To have a better view of the above computation in a table format, refer to the second and the third diagram in the image below.

8 0

3 years ago

A dollar available today is always worth more than a dollar not available until a future period.

Lostsunrise [7]

Answer:

The statement is: True.

Explanation:

The Time Value of Money is a concept that states a dollar today is always worth more than a dollar tomorrow. The theory relies on the earning capacity of money. The approach is the reason why entrepreneurs prefer to capitalize on their investments the soonest so the more money available now will represent for them more money accrued in the future.

8 0

3 years ago