!Required information[The following information applies to the questions displayed below.]Cane Company manufactures two products called Alpha and Beta that sell for $190 and $155, respectively. Each productuses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 122,000units of each product. Its average cost per unit for each product at this level of activity are given below:Direct materialsDirect laborVariable manufacturing overheadTraceable fixed manufacturing overheadVariable selling expensesCommon fixed expensesTotal cost per unitAlpha$ 403421292629$ 179BetaMaximum price to be paid per pound$242819322224$ 149The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expensesare unavoidable and have been allocated to products based on sales dollars.15. Assume that Cane's customers would buy a maximum of 94,000 units of Alpha and 74,000 units of Beta. Also assume that thecompany's raw material available for production is limited to 228,000 pounds. If Cane uses its 228,000 pounds of raw materials, up tohow much should it be willing to pay per pound for additional raw materials? (Round your answer to 2 decimal places.)

When the inputs are scarce, then the same is used to produce the maximum output where the…

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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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Cane Company manufactures two products called Alpha and Beta that sell for $120 and $80, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 100,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Alpha $ 30 Beta Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses $12 20 15 7 5 16 18 12 8 Common fixed expenses 15 10 Total cost per unit $ 100 $ 68 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 3. Assume that Cane expects to produce and sell 80,000 Alphas during the current year. One of Cane's sales representatives has found a new customer who is willing to buy 10,000 additional Alphas for a price of $80 per unit. What is the…
Required information [The following information applies to the questions displayed below.] Abel Company manufactures two products called Deluxe and Regular that sell for $68 and $39, respectively. Each product uses only one type of raw material that costs $3 per kilogram. The company has the capacity to annually produce 54,000 units of each product. Its unit costs for each product at this level of activity are given below: Direct materials Direct labour Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Deluxe $ 14 Regular $ 6 9 5.00 4.00 3.00 9 10 5 4 7.00 7 $ 48 $ 35 Cost per unit The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars. 8. Assume that Abel normally produces and sells 40,200 Regular units and 30,200 Deluxe units per year. If Abel discontinues the Regular product…
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Required Information [The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $225 and $175, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 130,000 units of each product. Its average cost per unit for each product at this level of activity is given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha $ 42 42 26 34 31 34 $ 209 Maximum price to be paid per pound Beta $ 24 32 24 37 27 29 $ 173 The company's traceable fixed manufacturing overhead is avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 15. Assume Cane's customers would buy a maximum of 99,000 units of Alpha and 79,000 units of Beta. Also assume the…
Required information [The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $225 and $175, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 130,000 units of each product. Its unit costs for each product at this level of activity are given below: Direct materials Direct labour Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Cost per unit Net operating income Alpha $42 42 26 34 31 34 $209 by The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars.
Bruce Corporation makes four products in a single facility. These products have the following unit product costs: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Unit product cost Additional data concerning these products are listed below. Grinding minutes per unit Selling price per unit Variable selling cost per unit Monthly demand in units Products A $14.80 C B $10.70 $11.50 27.90 3.20 19.90 4.80 27.00 35.30 $ 66.50 $ 77.10 $75.80 34.10 3.10 27.10 Products A B 4.30 5.80 $76.60 $94.00 $2.70 $ 1.70 4,500 4,500 D $ 11.10 40.90 3.70 37.70 $93.40 C D 4.80 3.90 $87.90 $ 104.70 $ 3.80 $ 2.10 3,500 2,500 The grinding machines are potentially the constraint in the production facility. A total of 71,400 minutes are available per month on these machines. Direct labor is a variable cost in this company. Up to how much should the company be willing to pay for one additional minute of grinding machine time if the company has made the best use of the…
Chhom, Inc., manufactures and sells two products: Product F9 and Product U4. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: Product F9 500 4 2,000 Product U4 1,000 2 2,000 Total direct labor-hours 4,000 The direct labor rate is $25.50 per DLH. The direct materials cost per unit is $274 for Product F9 and $222 for Product U4. The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Expected Activity Activity Cost Pools Activity Measures Overhead Cost Product F9 Product U4 Total Labor-related DLHs $ 31,900 2,000 2,000 4,000 Production orders orders 50,640 600 1,000 1,600 Order size MHs 103,200 3,300 2,600 5,900 $ 185,740 If the company allocates all of its overhead based on direct labor-hours using its…
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Wess company... (see pictures)
Required information [The following information applies to the questions displayed below.) Cane Company manufactures two products called Alpha and Beta that sell for $155 and $115, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 110,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead. Variable selling expenses Common fixed expenses Total cost per unit Alpha $24 23 22 23 Total contribution margin 19 22 $ 133 Beta $ 12 26 12 25 15 17 $ 107 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 14. Assume that Cane's customers would buy a maximum of 87,000 units of Alpha and 67,000 units of Beta. Also assume…
! Required information [The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $120 and $80, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 100,000 units of each product. Its average cost per unit for each product at this level of activity is given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha $ 30 20 7 16 12 15 $ 100 Beta $ 12 15 5 18 8 10 $ 68 The company's traceable fixed manufacturing overhead is avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 15. Assume Cane's customers would buy a maximum of 80,000 units of Alpha and 60,000 units of Beta. Also assume the company's raw material available for…
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