Moon Company includes 1 coupon in each box of soap powder that it packs, 20 coupons being redeemable for a premium consisting of a kitchen utensil

Moon Company includes 1 coupon in each box of soap powder that it packs, 20 coupons being redeemable for a premium consisting of a kitchen utensil. In 2010, Moon Company purchased 12,000 premiums at $1.00 each and sold 360,000 boxes of soap powder @ $4.00 per box. Based on past experience, it is estimated that 60% of the coupons will be redeemed. During 2010, 96,000 coupons were presented for redemption.

During 2011, 19,000 premiums were purchased at $1.10. The company sold 800,000 boxes of soap at $4.00 and 330,000 coupons were presented for redemption.

Instructions
Prepare all the entries that would be made relative to sales of soap powder and to the premium plan in both 2010 and 2011. Assume a FIFO inventory flow.


Click here for the solution: Moon Company includes 1 coupon in each box of soap powder that it packs, 20 coupons being redeemable for a premium consisting of a kitchen utensil

The Great Fish Taco Corporation currently has fixed operating costs of $15,000, sells its premade tacos for $6 per box, and incurs variable operating costs of $2.50 per box

E13-2 The Great Fish Taco Corporation currently has fixed operating costs of $15,000, sells its premade tacos for $6 per box, and incurs variable operating costs of $2.50 per box. If the firm has a potential investment that would simultaneously raise its fixed costs to $16,500 and allow it to charge a per-box sale price of $6.50 due to better-textured tacos, what will the impact be on its operating breakeven point in boxes?

Click here for the solution: The Great Fish Taco Corporation currently has fixed operating costs of $15,000, sells its premade tacos for $6 per box, and incurs variable operating costs of $2.50 per box