Assume if PowerPunch sells for \$7.25 per bottle, how much profit does the company earn per bottle of PowerPunc?

Assume if PowerPunch sells for \$7.25 per bottle, how much profit does the company earn per bottle of PowerPunc?

ATTACHMENT PREVIEW

Health Drinks Company produces two beverages, PowerPunch and SlimLife. Data about these products
follow.
PowerPunch
SlimLife
Production
volume
12,500 bottles
180,000 bottles
Liquid
materials
1,400 gallons
37,000 gallons
Dry materials
620 pounds
12,000 pounds
Bottles
12,500 bottles
180,000 bottles
Labels
3
labels per
bottle
1
label per
bottle
Machine
setups
500 setups
300 setups
Machine
hours
200 MH
3,750 MH
Additional data from its two production departments follow.
Department
Driver
Cost
Mixing
department
Liquid
materials
Gallons
\$ 2,304
Dry materials Pounds
6,941
Utilities
Machine hours
1,422
Bottling
department
Bottles
Units
\$ 77,000
Labeling
Labels per bottle
6,525
Machine setup Setups
20,000
1.
value:
8 points
Determine the cost of each product line using ABC.
Liquid
materials
\$ per gallon
Dry materials
\$ per pound
Utilities
\$ per MH
Bottles
\$ per bottle
Labeling
\$ per label
Machine setup
\$ per setup
PowerPunch
SlimLife
Liquid material
\$
\$
Dry material

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Utilities
Bottles
Labeling
Machine setup
Product Cost
\$
\$
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References
2.
value:
5 points
What is the cost per bottle for PowerPunch? What is the cost per bottle of SlimLife?
(
Hint:
should draw on the total cost for each product line computed in requirement 1. Round your
PowerPunch
SlimLife
Total cost of
line
\$
\$
÷ Production
volume
÷ bottles
÷ bottles
Average cost
per bottle
\$ /bottle
\$ /bottle
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