# Question & Answer: The Walton Toy Company manufactures a line of dolls and a doll dress sewing kit. Demand for the dolls is increasing…..

the walton toy company manufactures a line of dolls

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Question & Answer: The Walton Toy Company manufactures a line of dolls and a doll dress sewing kit. Demand for the dolls is increasing…..
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the walton toy company manufactures a line of dolls

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 Demand Selling Next year Price Direct Direct (units) per Unit Materials Labor \$2.70 \$1.20 \$4.50 \$3.30 \$0.90 Product Debbie Sarah Mike Sewing kit 51,000 \$15.50 \$4.40 43,000 6.00 \$1.20 36,000 \$25.00 \$6.59 40,000 \$11.00 \$2.10 326,000 8.10 \$3.30 The following additional information is available a. The company’s plant has a capacity of 118,450 direct labor-hours per year on a single-shift basis. Thee company’s present employees and equipment can produce all five products b. The direct labor rate of \$6 per hour is expected to remain unchanged during the coming year c. Fixed costs total \$530,000 per year. Variable overhead costs are \$3 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 Required 1. Determine the contribution margin per direct labor-hour expended on each product. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Contribution Product Margin per DLH Debbie Sarah Mike Sewing kit 2. Calculate the the total direct labor-hours that will be required to produce the units estimated to be sold during the coming year. (Do not round intermediate calculations.) Product Total Hours Debbie Sarah Mike Sewing Kit Total hours required

the walton toy company manufactures a line of dolls

 Debbie Trish Sarah Mike Sweing Kit Total Selling price 15.5 6 25 11 8.1 Less: Variable costs D.M 4.4 1.2 6.59 2.1 3.3 D.L 2.7 1.2 4.5 3.3 0.9 Variable OH costs 1.35 0.6 2.25 1.65 0.45 Contribution 7.05 3 11.66 3.95 3.45 Time required for one unit in hrs 0.45 0.2 0.75 0.55 0.15 1/6*2.7 1/6*1.2 1/6*4.5 1/6*3.3 1/6*.9 Contribution per hour 15.6667 15.0000 15.5467 7.1818 23.0000 Direct labor hours that will be required to produce the units estimated to be soldduring the coming year 22950 8600 27000 22000 48900 129450 Based on 118450 Direct labor hours of capacity will be allocated to various products Contribution per hour 15.6667 15.0000 15.5467 7.1818 23.0000 Ranking 2nd 4th 3rd 5th 1st 22950 8600 27000 6050 48900 0.55*11000 Highest contribution 359550 129000 419760 43450 1124700 2076460 eg:22950*15.667

the walton toy company manufactures a line of dolls

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