5:57ull ? 4special order-Albrecht Ltd..pdfIntermediate Management AccountingLesson 6-In-Class ProblemsICP 4Albrecht Ltd. manufactures tackle boxes, and the company estimates that during the firstquarter of this year, it will be operating at 80% of normal capacity. The selling price and costinformation for the tackle box is as follows:Selling price$22.50$ 6.25Direct materialsDirect labour (0.5 hours x $15.00)Overhead (0.25 machine hours x $10)7.502.50$16.25Albrecht is considering two special order requests to fill the remaining 20% of capacity. Thespecial order requests received are as follows:• Alan Co. has asked for a tackle box that is similar to Albrecht's boxes but which Alan wouldlike to market as its own. Alan is willing to pay $15.00 each for 20,000 boxes. The specialorder for Alan would have the same costs except for direct materials, which would be only$5.60 per box.• Shala Corp. has asked for 7,500 tackle boxes at $18.00 per box. This box will be differentthan the regular case Albrecht produces and would have the following cost data:$ 8.157.505.00$20.65Direct materialsDirect labour (0.5 hours x $15.00)Overhead (0.50 machine hours x $10)The Shala order will also result in $3,750 of setup costs and $6,250 for additionalequipment, which will be used only for this order and then discarded.Albrecht's manufacturing machine hours are limited to 7,500 per month. The budgeted fixedoverhead for this year is $540,000. Overhead is applied to production based on machine hoursat $10 per hour.Albrecht has the entire first quarter to work on the special orders, if accepted. Each specialorder is isolated and not expected to result in future sales from either Shala or Alan.Required:Should either or both special orders be accepted? What are the qualitative aspects of thisdecision?'CPAOHARTEREDPROFESSIONALACCOUNTANTSPREP7/ 20 6:37transfer price-West Industries.pdfIntermediate Management AccountingLesson 6-In-Class ProblemsICP 7West Industries is a highly decentralized corporation with independent operating divisions.Each division is evaluated and rewarded based on its total net income. One of the divisions,Visic, manufactures and sells air conditioners. Visic is projecting sales of 17,400 for next year.Another division, Weber, makes and sells compressors. Its projected income statement fornext year follows:Weber DivisionPro forma income statementFor next yearPer unitTotalSales revenues$100$6.400,000Less cost of goods sold:Direct materialsDirect labourVariable overhead12810768,000512,000640,000Fixed overhead1141704.0002.624,000Gross profit- 59-3.776,000Operating expenses:Variable selling expensesFixed selling expensesFixed administrative expenses384,000256,000448.0001.088.000417$ 42Pre-tax net income$2,688,000Weber has the capacity to produce 75,000 compressors annually. Visic currently purchasescompressors from an outside source at $70, and proposes that Weber transfer compressors toit at a transfer price of $50. The Visic manager justified the low bid based on some costsavings that should be realized if compressors are transferred. Because specifications for thiscompressor are slightly different from Weber's standard model, $1.50 of direct materials costper compressor can be saved and no variable selling expenses will be incurred oncompressors transferred.Required:a) Compute the minimum transfer price Weber should accept.b) Compute the estimated effect on Weber's net income if the 17,400 compressors aretransferred at $50 each.c) Determine whether it would be in West Industries' best interest for Weber to transfercompressors at $50 each.'CPACHARTEREDPROFESSONALPREPACCOUNTANTS12/ 20

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Thus fixed overhead cost will not be considered while making a decision as to special offer as same…

Business

Accounting

ICP 4 Albrecht Ltd. manufactures tackle boxes, and the company estimates that during the first quarter of this year, it will be operating at 80% of normal capacity. The selling price and cost information for the tackle box is as follows: Selling price $22.50 Direct materials Direct labour (0.5 hours x $15.00) Overhead (0.25 machine hours x $10) $ 6.25 7.50 2.50

ICP 4 Albrecht Ltd. manufactures tackle boxes, and the company estimates that during the first quarter of this year, it will be operating at 80% of normal capacity. The selling price and cost information for the tackle box is as follows: Selling price $22.50 Direct materials Direct labour (0.5 hours x $15.00) Overhead (0.25 machine hours x $10) $ 6.25 7.50 2.50

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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EXERCISE Gabriel Auto produces and sells an auto part for P30.00 per unit. In 2021, 100,000 parts were produced and 75,000 units were sold. Other information for the year are as follows: BUSINESS AD 5 1986 ATION Direct Materials cost/unit Direct Manufacturing Labor cost/unit Variable Manufacturing Costs/unit Sales Commissions/unit Fixed Manufacturing Costs (per year) Fixed Administrative Expenses (per year) Php 12.00 2.25 0.75 3.00 375,000.00 135,000.00 What is the Inventoriable cost/unit using Absorption Costing What is the Inventoriable cost/unit using Variable Costing THE PREMIER BUSINESS SCHOOL OF THE SOUTH
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Question 6 Amundsen Company makes 60,000 units per year of a part it uses in the products it manufactures. The unit product cost of this part is computed as follows: Direct Materials Direct Labor Variable Manufacturing Overhead Fixed Manufacturing Overhead Variable Selling Fixed Selling Total $ 10.10 $17.40 $ 2.70 $15.00 $ 2.75 $ 3.25 $51.20 An outside supplier has offered to sell the company all of these parts it needs. If the company accepts this offer, the facilities now being used to make the part would be idle and fixed manufacturing overhead would be reduced by 80% of current cost. The variable selling costs would be reduced to 40% of current cost. Required: What is the maximum amount the company should be willing to pay an outside supplier per unit for the part?
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Subject: Acounting
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uod cz 1.The cost to produce one unit of the product is: Material $ 13.00 Labor $8.00 Variable cost $7.00 Fixed expenses $ 18.00 Total fixed expenses: $ 500,000 The company's normal capacity is 100,000 units. The figures given above are for 80,000 units. The company has received a special offer for 20,000 units for a price of $ 36 per unit from a foreign customer. Advice the manufacturer on whether the order should be accepted or not. For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac). 3 (12pt) Qi:公 Arial vE - E T TTTT Paragraph v T T S T HTML CSS O fr Mashups