Ipha Incorporated regularly uses material FLAV4 and currently has in stock 510 liters of the material for which it paid $2,682 several weeks ago. If this were to be sold as is on the open arket as surplus material, it would fetch $5.50 per liter. New stocks of the material can be purchased on the open market for $6.30 per liter, but it must be purchased in lots of 1,250 liters. bu have been asked to determine the relevant cost of 1,050 liters of the material to be used in a job for a customer. The relevant cost of the 1,050 liters of material FLAV4 is: (CMA adapted) Multiple Choice O O O O $6,615. $5,775. $7,875. $6,207.

Ipha Incorporated regularly uses material FLAV4 and currently has in stock 510 liters of the material for which it paid $2,682 several weeks ago. If this were to be sold as is on the open arket as surplus material, it would fetch $5.50 per liter. New stocks of the material can be purchased on the open market for $6.30 per liter, but it must be purchased in lots of 1,250 liters. bu have been asked to determine the relevant cost of 1,050 liters of the material to be used in a job for a customer. The relevant cost of the 1,050 liters of material FLAV4 is: (CMA adapted) Multiple Choice O O O O $6,615. $5,775. $7,875. $6,207.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Park corporation is preparing a bid for a special order that would require 760 liters of materials SUN100. The company already has 580 liters of this raw material in stock that originally cost $6.70 per liter. Material SUN100 is used in the company's main product and is replenished on a periodic basis. The resale value of the existing stock of the material is $6.00 per liter. New stocks of the material can be readily purchased for $7.05 per liter. What is the relevant cost of the 760 liters of the raw material when deciding how much to bid on the special order? (CIMA adapted) $5,155 $5,358 $4,966 $4,560
Moona Inc.,is preparing a bid for a special order that would require 880 liters of material B101. The company already has 280 liters of this raw material in stock that originally cost $6.10 per liter. Material B101 is used in the company's main product and is replenished on a periodic basis. The resale value of the existing stock of the material is $5.45 per liter. New stocks of the material can be readily purchased for $6.20 per liter. What is the relevant cost of the 880 liters of the raw material when deciding how much to bid on the special order?
Scherer Corporation is preparing a bid for a special order that would require 720 liters of material U48N. The company already has 560 liters of this raw material in stock that originally cost $6.30 per liter. Material U48N is used in the company's main product and is replenished on a periodic basis. The resale value of the existing stock of the material is $5.80 per liter. New stocks of the material can be readily purchased for $6.65 per liter. What is the relevant cost of the 720 liters of the raw material when deciding how much to bid on the special order? Select one: a. $4,592 b. $4,788 c. $4,456 d. $4,176
* Your answer is incorrect. Crane Company sells 302 units of its products for $20 each to John Inc. for cash. Crane allows John to return any unused product within 30 days and receive a full refund. The cost of each product is $13. To determine the transaction price, Crane decides that the approach that is most predictive of the amount of consideration to which it will be entitled is the probability-weighted amount. Using the probability-weighted amount, Crane estimates that (1) 9 products will be returned and (2) the returned products are expected to be resold at a profit. (a) Indicate the amount of net sales. Net sales $ (b) Indicate the amount of estimated liability for refunds. Liability for refunds $ Cost of goods sold 5869 (c) Indicate the amount of cost of goods sold that Crane should report in its financial statements Lassume that none of the products fave been returned at the financial statement date) 5 eTextbook and Media 171 Q Search 3913 (7
Blossom Company sells 320 units of its products for $20 each to Wildhorse inc. for cash. Blossom allows Wildhorse to return any unused product within 30 days and receive a full refund. The cost of each product is $11. To determine the transaction price, Blossom decides that the approach that is most predictive of the amount of consideration to which it will be entitled is the probability weighted amount. Using the probability-weighted amount. Blossom estimates that (1) 7 products will be returned, and (2) the returned products are expected to be resold at a profit. Prepare the journal entries for Blossom at the time of the sale to Wildhorse including any expected returns. The company follows IFRS. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter "0" for the amounts. List all debit entries before credit entries.) Account Titles and Explanation Cash (To record…
One of your Taiwanese suppliers has bid on a new line of molded plastic parts that is currently being assembled at your plant. The supplier has bid s0.10 per part, given a forecast you provided of 100,000 parts in year 1, 300.000 in year 2; and 500.000 in year 3. Shipping and handiling of parts from the supplier's factory is estimated at $0.02 per unit. Additional inventory handling charges should amount to $0.004 per unit. Finally, administrative costs are estimated at $10 per month. Although your plant is able to continue producing the part, the plant would need to invest in another molding machine, which would cost $10,000. Direct materials can be purchased for $0.05 per unit. Direct labor is estimated at $0.03 per unit plus a 50 percent surcharge for benefits; indirect labor is estimated at $0.013 per unit plus 50 percent benefits. Up-front engineering and design costs will amount to $40,000. Finally, management has insisted that overhead be allocated if the parts are made in-house…
This question is based on t he following information: B Hon Company purchases thermostats and use them in heating units it manufactures. Annual requirement for the thermostat is 2,000 units. The cost per thermostat is P 20. The cost of placing a single order is P 50 while the cost of storage is 25% of the average inventory value. The suppler of the thermostat offers a discount of 2% if the company will order in lots of 500 units. 1. How much would be the total costs associated with the inventory if the company adopts the discounted ordering policy? . A. P 40,000 B. P 40,625 C. P 41,000 D. P 42,0002. How much is the net cash flow net of income taxes for the 3rd year?A. 17,268B. 22,000C. 22,994D. 30,618
Auto Zone purchases replacement brake fluid reservoirs directly from the manufacturer. Demand is roughly 1000 units per month over the year. Ordering costs are $25 per order and the reservoirs are $10.00 per unit. Annual holding costs are 20% of the value of the inventory. There are 311 working days per year and the lead time is 5 days. Address the following inventory management issues that need to be resolved. a) What is the EOQ for this component? b) What is the reorder point? c) What is the cycle time? d) What are the total annual holding and ordering costs associated with your recommended EOQ?
One of your Taiwanese suppliers has bid on a new line of molded plastic parts that is currently being assembled at your plant. The supplier has bid $0.10 per part, given a forecast you provided of 200,000 parts in year 1; 300,000 in year 2; and 500,000 in year 3. Shipping and handling of parts from the supplier’s factory is estimated at $0.01 per unit. Additional inventory handling charges should amount to $0.005 per unit. Finally,administrative costs are estimated at $20 per month. Although your plant is able to continue producing the part, the plant would need to invest in another molding machine, which would cost $10,000. Direct materials can be purchased for $0.05 per unit. Direct labor is estimated at $0.03 per unit plus a 50 percent surcharge for benefits; indirect labor is estimated at $0.011 per unit plus 50 percent benefits. Up-front engineering and design costs will amount to $30,000. Finally, management has insisted that overhead be allocated if the parts are made in-house…
Blossom Inc. is a cell phone wholesaler. At the beginning of the year, it purchased 1320 units of the most recent android phone for $500 each. The selling price during the year was $700 per unit. At year end, it had 320 units on hand. Due to changes in technology, the selling price will have to be reduced by 35% in order to sell the remaining phones. What is the inventory value of the android phones at the end of the period? O $160000 O $145600 O $104000 O $56000
Briquette Corporation has in stock 35,800 kilograms of material L that it bought five years ago for $5.55 per kilogram. This raw material was purchased to use in a product line that has been discontinued. Material L can be sold as is for scrap for $1.67 per kilogram. An alternative would be to use material L in one of the company's current products, Q08C, which currently requires 2 kilograms of a raw material that is available for $9.15 per kilogram. Material L can be modified at a cost of $0.78 per kilogram so that it can be used as a substitute for this material in the production of product Q08C. However, after modification, 4 kilograms of material L is required for every unit of product Q08C that is produced. Briquette Corporation has now received a request from a company that could use material L in its production process. Assuming that Briquette Corporation could use all of its stock of material L to make product Q08C or the company could sell all of its stock of the material at…
Briquette Corporation has in stock 35,800 kilograms of material L that it bought five years ago for $5.55 per kilogram. This raw material was purchased to use in a product line that has been discontinued. Material L can be sold as is for scrap for $1.67 per kilogram. An alternative would be to use material L in one of the company's current products, Q08C, which currently requires 2 kilograms of a raw material that is available for $9.15 per kilogram. Material L can be modified at a cost of $0.78 per kilogram so that it can be used as a substitute for this material in the production of product Q08C. However, after modification, 4 kilograms of material L is required for every unit of product Q08C that is produced. Briquette Corporation has now received a request from a company that could use material L in its production process. Assuming that Briquette Corporation could use all of its stock of material L to make product Q08C or the company could sell all of its stock of the material at…