Blake Enterprises can produce a component of its product that incurs the following costs per unit: • Direct materials: $12.00 • Direct labor: $18.00 • Variable overhead: $5.00 • Fixed overhead: $10.00 An outside supplier has offered to sell the product to Blake Enterprises for $40.00 per unit. Compute the net incremental cost or savings of buying the component. (a) $5.00 cost per unit (b) $10.00 savings per unit (c) $8.00 cost per unit (d) $10.00 cost per unit

Blake Enterprises can produce a component of its product that incurs the following costs per unit: • Direct materials: $12.00 • Direct labor: $18.00 • Variable overhead: $5.00 • Fixed overhead: $10.00 An outside supplier has offered to sell the product to Blake Enterprises for $40.00 per unit. Compute the net incremental cost or savings of buying the component. (a) $5.00 cost per unit (b) $10.00 savings per unit (c) $8.00 cost per unit (d) $10.00 cost per unit

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints

Section: Chapter Questions

Problem 3CE: Patz Company produces two types of machine parts: Part A and Part B, with unit contribution margins...

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See question in picture . Multiple choice options as follows : A. $4.00 B.$15.00 C. $18.00 D.$60.00
Yes Co. has the option to either further process product Y to produce Product Z. The selling price of product Y is $30 per unit and it costs $28 to produce each unit of product Y. Product Z would be sold for $55 and would require an additional $31 cost for production. What is the differential cost to produce product Z? a. $3 per unit b. $28 per unit c. $31 per unit d. $25 per unit
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