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View Full Version : Managerial Accounting Brandilyn Toy Company


cheergirl3789
Apr 30, 2013, 09:52 PM
The Brandilyn 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 the best sales and production mix for the coming year. The company has provided the following data:


Product
Demand Next year (units)
Selling Price per Unit
Direct Materials
Direct Labor

Marcy
32,000
$31
$3.10
$4.20

Tina
39,000
$24
$2.40
$2.40

Cari
38,000
$24
$3.80
$8.240

Lenny
43,000
$17
$3
$7.2

Sewing kit
390,000
$10
$1.7
$1.8


The following additional information is available:

a.
The company’s plant has a capacity of 117,100 direct labor-hours per year on a single-shift basis. The company’s present employees and equipment can produce all five products.
b. The direct labor rate of $12.00 per hour is expected to remain unchanged during the coming year.
c. Fixed costs total $426,000 per year. Variable overhead costs are $5.00 per direct labor-hour.
d. All of the company's nonmanufacturing costs are fixed.
e. The company’s finished goods inventory is negligible and can be ignored.

1.) Determine the contribution margin per direct labor-hour expended on each product.
I got this one right... then answers are :

Marcy: $62.71
Tina: $91
Cari: $11.86
Lenny: $6.33
Sewing kit: $38.33

2.)Calculate the total direct labor-hours that will be required to produce the units estimated to be sold during the coming year.

I have no idea how to do this. Please help!