Glasgow Enterprises started the period with 65 units in beginning inventory that cost $2.60 each. During the period, the company purchased inventory items as follows. Purchase No. of Items Cost 1 300 $3.10 2 200 $3.20 3 55 $3.60 Glasgow sold 325 units after purchasing 3 for $10.90 each. Glasgow's cost of goods sold under FIFO would be Purchases, $100,000; beginning inventory, $20,000; and ending inventory, $30,000. How much was the cost of goods sold? A. $50,000. B. $90,000. C. $45,000. D. $30,000. Country Jeans Co. has an annual plant capacity of 64,600 units, and current production is 43,500 units. Monthly fixed costs are $38,100, and variable costs are $25 per unit. The present selling price is $34 per unit. On February 2, 2014, the company received an offer from Miller Company for 14,300 units of the product at $28 each. Miller Company will market the units in a foreign country under its own brand name. The additional business is not expected to affect the domestic selling price or quantity of sales of Country Jeans Co. Prepare a differential analysis on whether to reject (Alternative 1) or accept (Alternative 2) the Miller order. What is the minimum price per unit that would produce a positive contribution margin? Round your answer to two decimal places.

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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Transcribed Image Text:Glasgow Enterprises started the period with 65 units in beginning inventory that cost $2.60 each. During the period, the company purchased inventory items as follows. Purchase No. of Items Cost 1 300 $3.10 2 200 $3.20 3 55 $3.60 Glasgow sold 325 units after purchasing 3 for $10.90 each. Glasgow's cost of goods sold under FIFO would be Purchases, $100,000; beginning inventory, $20,000; and ending inventory, $30,000. How much was the cost of goods sold? A. $50,000. B. $90,000. C. $45,000. D. $30,000. Country Jeans Co. has an annual plant capacity of 64,600 units, and current production is 43,500 units. Monthly fixed costs are $38,100, and variable costs are $25 per unit. The present selling price is $34 per unit. On February 2, 2014, the company received an offer from Miller Company for 14,300 units of the product at $28 each. Miller Company will market the units in a foreign country under its own brand name. The additional business is not expected to affect the domestic selling price or quantity of sales of Country Jeans Co. Prepare a differential analysis on whether to reject (Alternative 1) or accept (Alternative 2) the Miller order. What is the minimum price per unit that would produce a positive contribution margin? Round your answer to two decimal places.

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