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(c-d) Your answer is partially correct. (c) If Flounder could lease the manufacturing facilities to another company for $ 24,300 per year, what would be the net total cost to outsource production of the part? Net cost to buy $

(c-d) Your answer is partially correct. (c) If Flounder could lease the manufacturing facilities to another company for $ 24,300 per year, what would be the net total cost to outsource production of the part? Net cost to buy $

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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Part C 

(c-d) Your answer is partially correct. (c) If Flounder could lease the manufacturing facilities to another company for $ 24,300 per year, what would be the net total cost to outsource production of the part? Net cost to buy $
Transcribed Image Text:(c-d) Your answer is partially correct. (c) If Flounder could lease the manufacturing facilities to another company for $ 24,300 per year, what would be the net total cost to outsource production of the part? Net cost to buy $
The Flounder Company manufactures 4,300 units of a part that could be purchased from an outside supplier for $ 16 each. Flounder's costs to manufacture each part are as follows: Direct materials $ 4 Direct labor Variable manufacturing overhead 6 Fixed manufacturing overhead 10 Total $ 23 All fixed overhead is unavoidable and is allocated based on direct labor. The facilities that are used to manufacture the part have no alternative uses. (a-b) Your answer is correct. (a) Calculate relevant cost to make. Relevent cost to make $ 13 per unit (b) Should Flounder continue to manufacture the part? Yes
Transcribed Image Text:The Flounder Company manufactures 4,300 units of a part that could be purchased from an outside supplier for $ 16 each. Flounder's costs to manufacture each part are as follows: Direct materials $ 4 Direct labor Variable manufacturing overhead 6 Fixed manufacturing overhead 10 Total $ 23 All fixed overhead is unavoidable and is allocated based on direct labor. The facilities that are used to manufacture the part have no alternative uses. (a-b) Your answer is correct. (a) Calculate relevant cost to make. Relevent cost to make $ 13 per unit (b) Should Flounder continue to manufacture the part? Yes
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