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How much cost does Metlock-T have tied up in each of these T-shirts? If it normally sells these shirts for $14 to the retailer, how much gross margin per unit does it generate on these sales? (Round answers to 2 decimal places, e.g. 15.25.) Total cost Gross margin $ $ /unit /unit At the end of October, Karen lamented the company's situation: in the middle of production of Metlock-T's most popular long-sleeve T-shirt, the company ran out of its usual collars, purchased from one main supplier. That supplier was also sold out. Metlock-T could get a slightly different premade collar, from a new supplier, at the same cost. So Karen went ahead with the order, hoping it wouldn't delay production or affect the quality of the shirts. As it turned out, the new collars failed Metlock-T's quality control testing. Stuck with unwearable T-shirts, the company was also in a bind with its retail outlets, which wanted more shirts to sell! The costs to produce this most recent batch of shirts is as follows. Direct material Direct labor Manufacturing overhead Total costs Volume in batch $66,000 35,000 15,000 $116,000 20,000

How much cost does Metlock-T have tied up in each of these T-shirts? If it normally sells these shirts for $14 to the retailer, how much gross margin per unit does it generate on these sales? (Round answers to 2 decimal places, e.g. 15.25.) Total cost Gross margin $ $ /unit /unit At the end of October, Karen lamented the company's situation: in the middle of production of Metlock-T's most popular long-sleeve T-shirt, the company ran out of its usual collars, purchased from one main supplier. That supplier was also sold out. Metlock-T could get a slightly different premade collar, from a new supplier, at the same cost. So Karen went ahead with the order, hoping it wouldn't delay production or affect the quality of the shirts. As it turned out, the new collars failed Metlock-T's quality control testing. Stuck with unwearable T-shirts, the company was also in a bind with its retail outlets, which wanted more shirts to sell! The costs to produce this most recent batch of shirts is as follows. Direct material Direct labor Manufacturing overhead Total costs Volume in batch $66,000 35,000 15,000 $116,000 20,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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How much cost does Metlock-T have tied up in each of these T-shirts? If it normally sells these shirts for $14 to the retailer, how much gross margin per unit does it generate on these sales? (Round answers to 2 decimal places, e.g. 15.25.) Total cost Gross margin $ $ /unit /unit
Transcribed Image Text:How much cost does Metlock-T have tied up in each of these T-shirts? If it normally sells these shirts for $14 to the retailer, how much gross margin per unit does it generate on these sales? (Round answers to 2 decimal places, e.g. 15.25.) Total cost Gross margin $ $ /unit /unit
At the end of October, Karen lamented the company's situation: in the middle of production of Metlock-T's most popular long-sleeve T-shirt, the company ran out of its usual collars, purchased from one main supplier. That supplier was also sold out. Metlock-T could get a slightly different premade collar, from a new supplier, at the same cost. So Karen went ahead with the order, hoping it wouldn't delay production or affect the quality of the shirts. As it turned out, the new collars failed Metlock-T's quality control testing. Stuck with unwearable T-shirts, the company was also in a bind with its retail outlets, which wanted more shirts to sell! The costs to produce this most recent batch of shirts is as follows. Direct material Direct labor Manufacturing overhead Total costs Volume in batch $66,000 35,000 15,000 $116,000 20,000
Transcribed Image Text:At the end of October, Karen lamented the company's situation: in the middle of production of Metlock-T's most popular long-sleeve T-shirt, the company ran out of its usual collars, purchased from one main supplier. That supplier was also sold out. Metlock-T could get a slightly different premade collar, from a new supplier, at the same cost. So Karen went ahead with the order, hoping it wouldn't delay production or affect the quality of the shirts. As it turned out, the new collars failed Metlock-T's quality control testing. Stuck with unwearable T-shirts, the company was also in a bind with its retail outlets, which wanted more shirts to sell! The costs to produce this most recent batch of shirts is as follows. Direct material Direct labor Manufacturing overhead Total costs Volume in batch $66,000 35,000 15,000 $116,000 20,000
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