Oahu Inc. is considering an investment in new equipment that will be used to manufacture a smartphone. The phone is expected to generate additional annual sales of 4,500 units at $246 per unit. The equipment has a cost of $418,500, residual value of $31,500, and an 8-year life. The equipment can only be used to manufacture the phone. The cost to manufacture the phone follows: Line Item Description Amount Cost per unit: Direct labor $41.00 Direct materials 161.00 Factory overhead (including depreciation) 28.00 Total cost per unit $230.00 Determine the average rate of return on the equipment. If required, round to the nearest whole percent.fill in the blank 1 of 1 %

Oahu Inc. is considering an investment in new equipment that will be used to manufacture a smartphone. The phone is expected to generate additional annual sales of 4,500 units at $246 per unit. The equipment has a cost of $418,500, residual value of $31,500, and an 8-year life. The equipment can only be used to manufacture the phone. The cost to manufacture the phone follows: Line Item Description Amount Cost per unit: Direct labor $41.00 Direct materials 161.00 Factory overhead (including depreciation) 28.00 Total cost per unit $230.00 Determine the average rate of return on the equipment. If required, round to the nearest whole percent.fill in the blank 1 of 1 %

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 31P: Jonfran Company manufactures three different models of paper shredders including the waste...

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Line Item Description	Amount
Cost per unit:
Direct labor	$41.00
Direct materials	161.00
Factory overhead (including depreciation)	28.00
Total cost per unit	$230.00

Similar questions

Oahu Inc. is considering an investment in new equipment that will be used to manufacture a smartphone. The phone is expected to generate additional annual sales of 5,100 units at $276 per unit. The equipment has a cost of $521,700, residual value of $39,300, and an 8-year life. The equipment can only be used to manufacture the phone. The cost to manufacture the phone follows: Line Item Description Amount Cost per unit: Direct labor $47.00 Direct materials 182.00 Factory overhead (including depreciation) 31.60 Total cost per unit $260.60 Determine the average rate of return on the equipment. If required, round to the nearest whole percent.
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Shrewsbury Technologies, which manufactures high-technology instruments for spacecraft, is considering the sale of a navigational unit to a private company that wishes to launch its own communications satellite. The company plans to purchase 8 units, although it would also consider buying 16 units. Shrewsbury has started a chart relating labor time required to units produced: Unit Produced (X) Time Required to Produce the Xth Unit1 5,000 hours2 4,500 hours4 4,050 hours8 ?16 ? Required: Compute the labor time required to produce 8 and 16 units. Assume that labor time costs $140 per hour. Compare the cost of producing the 1st unit to the cost of producing the 16th unit. What is the percentage of the cost of the 16th unit to the cost of the 1st unit?
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Please show work
Please show work
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