Quail Company produces outdoor gear. Salter is a division of Quail that manufactures unbreakable zippers used in Quail's gear andsold to other manufacturers. Cost information per zipper follows:Variable costFull costMarket price$ 1.602.205.00In addition, Salter's capacity data follow:Capacity per yearCurrent production levelRequired:2,000,000 zippers1,500,000 zippers1. Assuming Quail produces 300,000 sleeping bags per year, what is the overall benefit of using zippers from Salter instead ofpurchasing them externally?2. Determine the maximum price the sleeping bag production facility would be willing to pay to purchase the zippers from Salter.3. Determine the minimum price Salter will accept as a transfer price.Note: Round your answer to 1 decimal place.4. Determine the mutually beneficial transfer price for the zippers.Note: Round your answer to 1 decimal place.5. If Salter were operating at capacity, what is the minimum price it would accept?Answer is not complete.1. Total savings with Quail putters2. Maximum price Quail would pay Salter3. Minimum price Salter will accept4. Mutually beneficial price5. Minimum price Salter would accept at capacity3 ☑

Dear student, check the answer in the explanation box below.Explanation:Dear student, the following…

Answered: Quail Company produces outdoor gear.…

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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Sunland Company manufactures and sells high-priced motorcycles. The Engine Division produces and sells to other motorcycle companies and internally to its Production Division. It has been decided that the Engine Division will sell 28000 units to the Production Division ar $1050 a unit. The Engine Division, currently operating at fall capacity, has a selling price of $3250 amd unit variable costs and unit fixed costs of $1050 and $650, respectively. The Production Division is currently paying $3000 per unit to an outside supplier. Of this amount, $110 per unit can be saved on internal sales from reduced selling expenses. What is the minimum transfer price that the Engine Division should accept? - $3140 - $ 2200 $3000 - $3250
Vandenberg, Inc., produces and sells two products: a ceiling fan and a table fan. Vandenberg plans to sell 40,000 ceiling fans and 70,000 table fans in the coming year. Product price and cost information includes: Ceiling Fan Table Fan Price $56 $17 Unit variable cost $13 $8 Direct fixed cost $21,200 $43,000 Common fixed selling and administrative expenses total $98,000. Required: 1. What is the sales mix estimated for next year (calculated to the lowest whole number for each product)?Sales mix of ceiling fans to table fans = ______ : _____ 2. Using the sales mix from Requirement 1, form a package of ceiling fans and table fans. How many ceiling fans and table fans are sold at break-even? Round your intermediate calculations and final answers to the nearest whole number. Break-even ceiling fans ______ Break-even table fans ______ 3. Prepare a contribution-margin-based income statement for Vandenberg, Inc., based on the unit sales calculated in Requirement 2. If…
Sako Company’s Audio Division produces a speaker that is used by manufacturers of various audio products. Sales and cost data on the speaker follow: Selling price per unit on the intermediate market $ 136 Variable costs per unit $ 118 Fixed costs per unit (based on capacity) $ 8 Capacity in units 25,000 Sako Company has a Hi-Fi Division that could use this speaker in one of its products. The Hi-Fi Division will need 5,000 speakers per year. It has received a quote of $133 per speaker from another manufacturer. Sako Company evaluates division managers on the basis of divisional profits. Required: Assume the Audio Division sells only 20,000 speakers per year to outside customers. From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the Hi-Fi Division? From the standpoint of the Hi-Fi Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division? What is the range of…
Sako Company’s Audio Division produces a speaker that is used by manufacturers of various audio products. Sales and cost data on the speaker follow:Selling price per unit on the intermediate market $ 80Variable costs per unit $ 62Fixed costs per unit (based on capacity) $ 8Capacity in units 25,000 Sako Company has a Hi-Fi Division that could use this speaker in one of its products. The Hi-Fi Division will need 5,000 speakers per year. It has received a quote of $77 per speaker from another manufacturer. Sako Company evaluates division managers on the basis of divisional profits.Required: 1. Assume the Audio Division is selling 22,500 speakers per year to outside customers. A. From the standpoint of the Audio Division, what is the lowest acceptable transfer price for speakers sold to the Hi-Fi Division? B. From the standpoint of the Hi-Fi Division, what is the highest acceptable transfer price for speakers acquired from the Audio Division? C. What is the…
Snapware Systems produces commercial strength cleansing supplies. Two of its main products are window cleaner that uses ammonia, and floor cleaner that uses bleach. Information for the most recent period follows: Product Names Window Cleaner (ammonia) Floor Cleaner (bleach) Direct materials information: Standard ounces per unit 16 oz. 24 oz. Standard price per ounce $0.75 ? Actual quantity used per unit 20 oz. 22 oz. Actual price paid for material $1.00 $0.90 Actual quantity purchased and used 1,500 oz. 2,800 oz.. Price variance ? $300 U Quantity variance $1,500 U ? Total direct materials variance ? $678 F Number of units produced 500 600 What is the standard price for bleach? Select one: a. $0.88/oz. b. $1.09/oz. c. $1.14/oz. d. $0.79/oz. e. $0.92/oz.
The Rosa model of Mohave Corporation is currently manufactured as a very plain umbrella with no decoration. The company is considering changing this product to a much more decorative model by adding a silk-screened design and embellishments. A summary of the expected costs and revenues for Mohave's two options follows: Estimated demand Estimated sales price Estimated manufacturing cost per unit Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Unit manufacturing cost Additional development cost Rosa Umbrella 29,000 units $31.00 $ 21.50 4.50 3.50 6.00 $ 35.50 Decorated Umbrella 29,000 units $ 41.00 $ 23.50 7.00 5.50 6.00 $ 42.00 $ 12,000 Required: 1. Determine the increase or decrease in profit if Mohave sells the Rosa Umbrella with the additional decorations. 2. Should Mohave add decorations to the Rosa umbrella? 3-a.Suppose the higher price of the decorated umbrella is expected to reduce estimated demand for this product to 27,000 units.…
Torge Company bought a machine for $66,800 cash. The estimated useful life was five years, and the estimated residual value was $5,600. Assume that the estimated useful life in productive units is 153,000. Units actually produced were 40,600 in year 1 and 45,900 in year 2. Required: 1. Determine the appropriate amounts to complete the following schedule. Method of Depreciation Straight-line Units-of-production Double-declining-balance Depreciation Expense for Year 1 Year 2 Book Value at the End of Year 11 Year 2
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Glassworks makes products for the sandblasting industry. One of the products they make is bags of high-grade sandblasting media that is made from a combination of quartz-sand and recycled ground-glass (cullet). Standard costs and quantities to produce one bag of sandblasting media are as follows: Quantity Cost Quartz-sand 20 kg $4.00 Cullet 5 kg $3.00 80,000 bags of sandblasting media were produced. Actual purchases and inventories were: Beginning Ending Purchases Purchases Inventory Inventory (in kg) ( in $) Quartz-sand 0 kg 0 kg 1,610,000 kg $322,161 Cullet 0 kg 120,000 kg 550,000 kg $286,000 Required: Calculate the following variances: a)Total direct material efficiency variance. b)Total direct material mix variance.…
Vandenberg, Inc., produces and sells two products: a ceiling fan and a table fan. Vandenberg plans to sell 40,000 ceiling fans and 60,000 table fans in the coming year. Product price and cost information includes: Ceiling Fan Table Fan Price $54 $12 Unit variable cost $11 $9 Direct fixed cost $20,800 $41,000 Common fixed selling and administrative expenses total $84,000. Required: 1. What is the sales mix estimated for next year (calculated to the lowest whole number for each product)?Sales mix of ceiling fans to table fans = _______ : __________ 2. Using the sales mix from Requirement 1, form a package of ceiling fans and table fans. How many ceiling fans and table fans are sold at break-even? Round your intermediate calculations and final answers to the nearest whole number. Break-even ceiling fans ______ Break-even table fans _______ 3. Prepare a contribution-margin-based income statement for Vandenberg, Inc., based on the unit sales…
The Rosa model of Mohave Corporation is currently manufactured as a very plain umbrella with no decoration. The company is considering changing this product to a much more decorative model by adding a silk-screened design and embellishments. A summary of the expected costs and revenues for Mohave’s two options follows: Rosa Umbrella Decorated Umbrella Estimated demand 11,000 units 11,000 units Estimated sales price $ 9.00 $ 20.00 Estimated manufacturing cost per unit Direct materials $ 3.50 $ 5.50 Direct labor 1.50 4.00 Variable manufacturing overhead 0.50 2.50 Fixed manufacturing overhead 2.00 2.00 Unit manufacturing cost $ 7.50 $ 14.00 Additional development cost $ 11,000 Required: 1. Determine the increase or decrease in profit if Mohave sells the Rosa Umbrella with the additional decorations. 2. Should Mohave add decorations to the Rosa umbrella? 3-a.Suppose the higher price of the decorated umbrella is expected to…

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