Technology sells arc computer printers for $60 per unit Unit product costs are: Zena Technology cost data Costs Direct materials Direct labor Manufacturing overhead Amounts $12 22 4 A special order to purchase 14,519 arc printers has recently been received from another company and Zena has idle capacity to fill the order. Zena will incur an additional $4 per printer for additional labor costs due to a slight modification the buyer wants made to the original product. One-third of the manufacturing overhead costs is fixed and will be ncurred no matter how many units are produced. When negotiating the price, what is the minimum selling price per unit that Zena should accept for this special order? Round to the nearest penny, two decimal places.
Q: The Northern Company manufactures 2,800 units per year. The full manufacturing costs per unit are as…
A: MAKE OR BUY DECISIONThe make-or-buy decision is choosing between manufacturing a product within a…
Q: Refer to Lopez Corporation. Assume that Lopez has sufficient idle capacity to produce the 1,000…
A: Sales Revenue: Sales revenue is the amount earned by the company by selling the goods or providing…
Q: Lewis Auto Company manufactures a part for use in its production of automobiles. When 10,000 items…
A: Relevant cost are avoidable cost and are affected by specific business decisions. In make or buy…
Q: Mohave Corp. is considering outsourcing production of the umbrella tote bag included with some of…
A: Solution:- 1)Computation of the difference in cost between making and buying the umbrella tote bag…
Q: Fancy Lighting Company makes 4,000 units per year of a part it uses in the luxury lighting products…
A: Every business organization aims is to earn maximum profit, In the competitive environment is it not…
Q: Crystal has received a special order for 4,000 units of its product. The product normally sells for…
A: Minimum selling price = incremental revenue/number of units
Q: Laser Cast Inc. manufactures color laser printers. Model J20 presently sells for $700 and has a…
A: The target cost serves as a benchmark for the product development process. It guides the company's…
Q: e $1.00 per pipe. Plastic Pipe's variable selling expense for its normal line o on Plastic Pipe's…
A: Additional sales revenue (1200*$11) $13,200 Less : Variable manufacturing cost (1200*$7) ($8400)…
Q: undle Electronics currently produces the shipping containers it uses to deliver the electronics…
A: Variable costs are costs that vary with the change in the level of output whereas fixed costs are…
Q: Perez Electronics currently produces the shipping containers it uses to deliver the electronics…
A: a. Total relevant cost = Unit-level materials + Unit-level labor + Unit-level overhead +…
Q: S Mc Alpena Corporation manufactures smartphone and tablet cases. The following is the cost of each…
A: Incremental cost is the overall expense incurred as a result of producing one extra unit of a…
Q: Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current…
A: Hence, the change in income when fixed cost is unavoidable is $30,120. There is a decrease in income…
Q: Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current…
A: Net income is the amount of money earned by the entity after deducting the expenses from the…
Q: Ahrends Corporation makes 41,000 units per year of a part it uses in the products it manufactures.…
A: The objective of the question is to determine the maximum amount that Ahrends Corporation should be…
Q: Baird Electronics currently produces the shipping containers it uses to deliver the electronics…
A: a. Total relevant cost = Material + Labor + overhead + Product level cost =6500+6400+4100+9600*1/3 =…
Q: Zena Technology sells arc computer printers for $55 per unit. Unit product costs are: Zena…
A: Note: As per the general rule, in the case of sufficient capacity available, the minimum selling…
Q: Zena Technology sells arc computer printers for $58 per unit. Unit product costs are: Zena…
A: Minimum Selling price per unit = Direct material + direct labor + (manufacturing overhead x 2/3) +…
Q: Zena Technology sells arc computer printers for $55 per unit. Unit product costs are: Direct…
A: The company should set up the minimum selling price where it can cover all the necessary costs. In…
Q: Part P40 is a part used in the production of dehumidifiers at Pollock Corporation. The following…
A: Operating Income: Operating income is the profit of the company which comes after deducting…
Q: Aldean Company makes 100,000 units per year of a part called U67 for use in one of its products.…
A: Hi student Since there are multiple subparts, we will answer only first three subparts.
Q: Snowy Mountain manufactures snowboards. Its cost of making 19,000 bindings is as follows Direct…
A: Variable cost means the cost which vary with the level of output and fixed cost means the cost which…
Q: Zena Technology sells arc computer printers for $56 per unit. Unit product costs are: Direct…
A: Solution: Minimum selling price = direct material + direct labor + variable overhead + increase in…
Q: Downtown Manufacturers makes and sells Iron box stands. Each unit sells for $220. The following cost…
A: Relevant cost :— It is the cost that are different in different alternatives. Relevant cost = Cost…
Q: Vernon Electronics currently produces the shipping containers it uses to deliver the electronics…
A: Buy cost is the cost of purchasing the product from outside.Make cost is the cost of making/…
Q: Mohave Corporation is considering outsourcing production of the umbrella tote bag included with some…
A: The relevant cost is the cost which differs between the two alternatives and which is avoidable. If…
Q: Crane Company produces golf discs which it normally sells to retailers for $7 each. The cost of…
A: Please see the answers below. Explanation: Step 1: (a) Incremental Analysis for the Special Order In…
Q: 3. Zena Technology sells arc computer printers for $55 per unit. Unit product costs are: Direct…
A: For accepting or rejecting a special offer, the decision based on variable costing method. Variable…
Q: a will incur an additional $2 per printer for additional labor costs due to a slight modification…
A: Given: The data is given as below,
Q: 1 Mohave Corporation is considering outsourcing production of the umbrella tote bag included with…
A: Solution:-The differential analysis is performed when two alternatives are available within the…
Q: Carver Company manufactures a component used in the production of one of its main products. The…
A: CONTRIBUTION is the difference between selling price and variable cost
Q: Luca Inc. has received a special order for 2,000 units of its product at a special price of $75. The…
A: Management accounting is widely used by managers to determine the differential costs of the product…
Q: Rutro Corp. makes 59,000 units per year of a part it uses in the products it manufactures. The unit…
A: Make or Buy Decision: A make-or-buy choice is one in which a company decides whether to manufacture…
Q: Scott Corporation produces a part that is used in the production of one of its products. The…
A: Solution Concept In a make or buy decision , the cost of making a product is compared to the cost of…
Q: Tamarisk Company produces golf discs, which it normally sells to retailers for $8 each. The cost of…
A: Accept or reject a special order is the managerial decision making process that helps in analyzing…
Q: Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current…
A: MAKE OR BUY DECISION The make-or-buy decision is choosing between manufacturing a product within a…
Q: Finch Electronics currently produces the shipping containers it uses to deliver the electronics…
A: When choosing whether to create a product domestically or purchase it from a third party, a…
Q: Clemente Inc. incurs the following costs to produce 10,000 units of a subcomponent: Direct materials…
A: The decision to purchase the product or to manufacture it in-house involves considering various…
Q: Mohave Corporation is considering outsourcing production of the umbrella tote bag included with some…
A: Make or buy is the differential analysis which helps the entity to decide whether to make the goods…
Q: Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current…
A: MAKE OR BUY DECISION The make-or-buy decision is choosing between manufacturing a product within a…
Q: Division A makes a part that it sells to customers outside of the company. Data concerning this part…
A: The objective of the question is to determine the lowest acceptable transfer price from the…
Q: A manufacturer produces hacksaw blades. Recently, the manufacturer has decided to enhance its…
A: This pertains to relevant cost analysis. Relevant costs are those costs that change when a decision…
Q: Adams Electronics currently produces the shipping containers it uses to deliver the electronics…
A: The relevant costs are the avoidable costs that can be ignored if the alternative is not chosen. The…
Q: Bramble Corp. incurs the following costs to produce 12000 units of a subcomponent: Direct materials…
A: The increase (Decrease) in net income from accepting outside supplier offer is based on difference…
Q: Vaughn Manufacturing incurs the following costs to produce 10,400 units of a subcomponent: Cost…
A: Solution Production- Direct material 8736 Direct labor 11752 Variable overhead 13104…
Q: Required a. Calculate the total relevant cost. Should Campbell continue to make the containers? b.…
A: A make-or-buy choice is made while deciding whether to manufacture a product internally or to buy it…
Q: Mohave Corp. is considering outsourcing production of ht eumbrella tote bag included with some of…
A: Calculation of above requirement are as follows
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Jordan Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,100 containers follows. Unit-level materials Unit-level labor Unit-level overhead Product-level costs Allocated facility-level costs $ 5,700 6,800 3,900 8,100 27,200 One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Jordan for $2.90 each. Required a. Calculate the total relevant cost. Should Jordan continue to make the containers? b. Jordan could lease the space it currently uses in the manufacturing process. If leasing would produce $12.300 per rhonth, calculate the total avoidable costs. Should Jordan continue to make the containers? a. Total relevant cost Should Jordan continue to make the containers? b. Total avoidable cost Should Jordan continue to make the containers?Vista Company manufactures electronic equipment. It currently purchases the special switches used in each of its products from an outside supplier. The supplier charges Vista $5.50 per switch. Vista's CEO is considering purchasing either machine A or machine B so the company can manufacture its own switches. The projected data are as follows: Annual fixed costs Variable cost per switch Machine A $632,400 1.78 Required: 1. For each machine, what is the minimum number of switches that Vista must make annually for total costs to equal outside purchase cost? 2. What volume level would produce the same total costs regardless of the machine purchased? 3. What is the most profitable alternative for producing 235,000 switches per year and what is the total cost of that alternative? Required 1 Required 2 Required 3 Complete this question by entering your answers in the tabs below. Machine B $ 860,100 0.80 Minimum number of switches For each machine, what is the minimum number of switches that…Ahrends Corporation makes 46,000 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 Unit product cost $ 14.30 23.90 3.00 28.30 $69.50 An outside supplier has offered to sell the company all of these parts it needs for $55.80 a unit. If the company accepts this offer, the facilities now being used to make the part could be used to make more units of a product that is in high demand. The additional contribution margin on this other product would be $368,000 per year If the part were purchased from the outside supplier, all of the direct labor cost of the part would be avoided. However, $24.90 of the fixed manufacturing overhead cost being applied to the part would continue even if the part were purchased from the outside supplier. This fixed manufacturing overhead cost would be applied to the company's remaining products What…
- Rooney Electronics currently produces the shipping containers it uses to deliver the electronics products it sells. The monthly cost of producing 9,100 containers follows. Unit-level materials Unit-level labor Unit-level overhead Product-level costs* $ 5,200 6,500 3,600 9,300 26,600 Allocated facility-level costs *One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Rooney for $2.70 each. Required a. Calculate the total relevant cost. Should Rooney continue to make the containers? b. Rooney could lease the space it currently uses in the manufacturing process. If leasing would produce $11,500 per month, calculate the total avoidable costs. Should Rooney continue to make the containers? a. Total relevant cost Should Rooney continue to make the containers? b. Total avoidable cost Should Rooney continue to make the containers?OutsourcingTuff Tach produces pickup truck bumpers that are sold on a wholesale basis to new car retailers. The average bumper sales price is $170. Normal annual sales volume is 300,000 units, which is the company’s maximum production capacity. At this capacity, the company’s per-unit costs are as follows: Direct material $53.00 (including mounting hardware @ $15 per unit) Direct labor 17.00 Overhead (2/3 is fixed) 45.00 Total $115.00 A key component in producing bumpers is the mounting hardware used to attach the bumpers to the vehicles. Birmingham Mechanical has offered to sell Tuff Tach as many mounting units as the company needs for $20 per unit. If Tuff Tach accepts the offer, the released facilities currently used to produce mounting hardware could be used to produce an additional 4,800 bumpers. What alternative is more desirable and by what amount? (Assume that the company is currently operating at its capacity of 300,000 units.)Note: Do not use a negative…Mohave Corporation is considering outsourcing production of the umbrella tote bag included with some of its products. The company has received a bid from a supplier in Vietnam to produce 8,700 units per year for $10.00 each. Mohave the following information about the cost of producing tote bags: Direct materials $ 6.00 Direct labor 2.00 Variable manufacturing overhead 1.00 Fixed manufacturing overhead 1.50 Total cost per unit $ 10.50 Mohave determined all variable costs could be eliminated by outsourcing the tote bags, while 70 percent of the fixed overhead cost is unavoidable. At this time, Mohave has no specific use in mind for the space currently dedicated to producing the tote bags. Required: 1) Based on the incremental analysis, should Mohave buy the tote bags or continue making them? 2) Suppose the space Mohave currently uses to make the bags could be utilized by a new product line that would generate $12,000 in annual profits. Recompute the difference in cost…
- Werner Company produces and sells disposable foil baking pans to retailers for $2.65 per pan. The variable cost per pan is as follows: Direct materials Direct labor Variable factory overhead Variable selling expense Fixed manufacturing cost totals $143,704 per year. Administrative cost (all fixed) totals $19,596. Required: $0.27 0.51 0.69 0.18 Compute the number of pans that must be sold for Werner to break even. pans Conceptual Connection: What is the unit variable cost? What is the unit variable manufacturing cost? Round your answers to the nearest cent. Unit variable cost Unit variable manufacturing cost Which is used in cost-volume-profit analysis? Unit variable cost ✓ How many pans must be sold for Werner to earn operating income of $7,000? pans How much sales revenue must Werner have to earn operating income of $7,000?Ahrends Corporation makes 43,000 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 Unit product cost $ 12.80 23.30 2.10 26.50 $ 64.70 An outside supplier has offered to sell the company all of these parts it needs for $51.00 a unit. If the company accepts this offer, the facilities now being used to make the part could be used to make more units of a product that is in high demand. The additional contribution margin on this other product would be $301,000 per year. If the part were purchased from the outside supplier, all of the direct labor cost of the part would be avoided. However, $23.40 of the fixed manufacturing overhead cost being applied to the part would continue even if the part were purchased from the outside supplier. This fixed manufacturing overhead cost would be applied to the company's remaining products.…Zena Technology sells arc computer printers for $56 per unit. Unit product costs are: Direct materials $15 Direct labor 20 Manufaturing overhead 6 Total $41 A special order to purchase 16,000 arc printers has recently been received from another company and Zena has idle capacity to fill the order. Zena will incur an additional $3 per printer for additional labor costs due to a slight modification the buyer wants made to the original product. One-third of the manufacturing overhead costs is fixed and will be incurred no matter how many units are produced. When negotiating the price, what is the minimum selling price that Zena should accept for this special order? $fill in the blank 1 per unit
- Mo Furniture manufactures a frame for use in its production of sofas. When 10,000 frames are produced, the costs per unit are: Direct materials $ 12 Direct manufacturing labor 60 Variable manufacturing overhead 24 Fixed manufacturing overhead 32 Total $128 A company has offered to sell Mo Furniture 10,000 sofa frames for $120 per unit. Fixed manufacturing overhead of $20 per unit used to make the frame could be eliminated if the frames were purchased instead of made. What is the relevant cost per unit to make the frame in this make or buy decision?Thornton Electronics currently produces the shipping containers It uses to deliver the electronics products It sells. The monthly cost of producing 9,100 containers follows. Unit-level materials Unit-level labor Unit-level overhead Product-level costs* Allocated facility-level costs $ 5,100 6,400 3,300 9,900 28,000 *One-third of these costs can be avoided by purchasing the containers. Russo Container Company has offered to sell comparable containers to Thornton for $2.60 each. Required a. Calculate the total relevant cost. Should Thornton continue to make the containers? b. Thornton could lease the space it currently uses in the manufacturing process. If leasing would produce $12,100 per month, calculate the total avoidable costs. Should Thornton continue to make the containers? a. Total relevant cost a. Should Thornton continue to make the containers? b. Total avoidable cost b. Should Thornton continue to make the containers?Beach Blanket Bonanza Corporation sells its popular mid-century beach towel for $18 per unit, and the standard cost card for the product shows the following costs: Direct material $1 Direct labor 2 Overhead (80% fixed) 7 Total $10 Beach Blanket Bonanza Corporation received a special order for 1,000 units of the beach towel. The only additional cost to Beach Blanket Bonanza would be foreign import taxes of $1 per unit. If Beach Blanket Bonanza is able to sell all of the current production domestically, what would be the minimum sales price that Beach Blanket Bonanza would consider for this special order? Group of answer choices $11.00 $19.00 $5.40 $18.00