Jonathan Sports, Inc., produces high-quality sports equipment. The company’s Racket Division manufactures three tennis
Posted: Sun Jun 05, 2022 5:06 pm
Jonathan Sports, Inc., produces
high-quality sports equipment. The company’s Racket Division
manufactures three tennis racquets—the Standard, the Deluxe, and
the Pro—that are widely used in amateur play. Selected
information on the racquets is given below:
Standard
Deluxe
Pro
Selling price per
racquet
$40.00
$60.00
$90.00
Variable expenses per racquet:
Production
$22.00
$27.00
$31.50
Selling (5% of selling
price)
$
2.00
$
3.00
$ 4.50
All sales are made through the
company’s own retail outlets. The Racquet Division
has the following monthly fixed costs:
Fixed production
costs
$150,000
Advertising
expense
100,000
Administrative
salaries
200,000
Total
$450,000
Sales of the three racquets are in the
proportion of 6 to 2 to 2, Standard, Deluxe, and Pro,
respectively.
Required:
high-quality sports equipment. The company’s Racket Division
manufactures three tennis racquets—the Standard, the Deluxe, and
the Pro—that are widely used in amateur play. Selected
information on the racquets is given below:
Standard
Deluxe
Pro
Selling price per
racquet
$40.00
$60.00
$90.00
Variable expenses per racquet:
Production
$22.00
$27.00
$31.50
Selling (5% of selling
price)
$
2.00
$
3.00
$ 4.50
All sales are made through the
company’s own retail outlets. The Racquet Division
has the following monthly fixed costs:
Fixed production
costs
$150,000
Advertising
expense
100,000
Administrative
salaries
200,000
Total
$450,000
Sales of the three racquets are in the
proportion of 6 to 2 to 2, Standard, Deluxe, and Pro,
respectively.
Required: