Produet Profitability Analysis Galaxy Sports Inc. manufactures and sells two styles of All Terrain Vehicles...
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Accounting
Produet Profitability Analysis Galaxy Sports Inc. manufactures and sells two styles of All Terrain Vehicles (ATVs), the Conquistador and Hurricane, from a single manufacturing facility. The manufacturing facility operates at 100% of capacity. The following per-unit information is available for the two products: In addition, the following sales unit volume information for the period is as follows: a. Prepare a contnbution maroin by product report. Compute thikoontribution margin ratio for each product as a whole percent. Gataxy Sports inc. Contribution Margin by Product FCheck My Wbe. To recast the contribution margin data by product report, multiply the sales volume by each per unit amount. To calculate the contribution margin ratio, divide the contribution margin by sales. What advice would you give to the management of Galaxy Sports Inc. regarding the profitability of the two products? line grovides the largest total contribution margin and the largest contribution margin ratio. If the sales mix were shifted more toward the line, the overall profitability of the compary would increase. Fecoser Tcheck wion Seles mix is the relative amount of sales among the various products. A company should focus its sales efforts on prodacts that will provide the maximum total contribution margin


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