Answer:(1) Baked Goods profit $6,700, Milk and Fruit juice profit $200, Frozen Products profit $8,900 (2) Baked Goods profit $160, Milk and Fruit juice profit $2,870, Frozen Products Profit $12,860. (3) it provide insight to FS managers that Frozen Products is the most profitable among the three product lines.
Explanation:
(1) Baked Goods. Milk and Fruit juice. Frozen Products
$ $ $
Revenue. 60,000. 66,500. 50,500
Less : Cost of good sold 41,000. 51,000. 32,000
------------- -------------- ---------------
Gross Margin. 19,000. 15,500. 18,500
Less: Store Support. 12,300. 15,300. 9,600
----------- ------------ -------------
Profit. 6,700. 200. 8,900
------------- --------------- ----------------'
(2)
Baked Goods. Milk and Fruit juice. Frozen Products
$ $ $
Revenue. 60,000. 66,500. 50,500
Less Cost of good sold 41,000. 51,000. 32,000
------------- ---------------- -----------
Contribution. 19,000. 15,500. 18,500
Less Overhead
Ordering cost. 4,180. 2,280. 1,,330
Delivery&Receipt. 9,120. 4,560. 2,736
Shelf Stocking. 3,230. 2,850. 380
Customer Support & Assistant 2,310. 3,030. 1,194
------------ -------------- ------------
Profit. 160. 2,870. 12,860
------------------ ----------------- ---------------
(3) The new insight to FS managers is that Frozen Products is the most profitable among the three products lines
Workings
Ordering cost ($95 × 44) = 4,180 ($95 × 24) = 2,280 ($95 × 14) = 1,330
Delivery &Receipt ($76 × 120) = 9,120 ($76 × 60) = 4,560 ($76 × 36) = 2,736
Shelf Stocking ($19 × 170) = 3,230 ($19 × 150) = 2,850 ( $19 × 20) = 380
Customer Support &Assistant ($0.15 × 15,400) = 2,310 ($0.15 × 20,200) = 3,030 ($0.15 × 7,960)= 1,194
