The manufacturing plant of Carilla Ltd. specializes in crafting specialized pieces for camival.With a monthly production capacity of 15,000 pieces, the company currently manufactures andsells 11,000 pieces per month. Typically priced at $200 per piece, the company's costbreakdown for the ongoing production level is outlined below:Variable costs that vary with number of units producedDirect materials$440,000Direct manufacturing labor495,000Variable costs (for setups, materials handling, quality control, etc.)that vary with number of batches, 220 batches * $500 per batch110,000⚫ Fixed CostsFixed manufacturing costsFixed marketing costsTotal costs300,000200,000$1,545,000Carilla has just received a special one-time-only order for 4,000 pieces at $150 per piece.Accepting the special order would not affect the company's regular business. Carilla makespieces for its existing customers in batch sizes of 50 pieces (220 batches 50 pieces per batch =11,000 pieces). The special order requires Carilla to make the pieces in 40 batches of 100 each.

Carilla Ltd. should accept the special one-time order for 4,000 pieces at $150 per piece. The…

Answered: The manufacturing plant of Carilla Ltd.…

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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Meman
Fremont Computer Company has been purchasing carrying cases for its portable computers at a purchase price of $57 per unit. The company, which is currently operating below full capacity, charges factory overhead to production at the rate of 46% of direct labor cost. The unit costs to produce comparable carrying cases are expected to be as follows: Direct materials $24 Direct labor 16 Factory overhead (46% of direct labor) 7.36 Total cost per unit $47.36 If Fremont Computer Company manufactures the carrying cases, fixed factory overhead costs will not increase and variable factory overhead costs associated with the cases are expected to be 13% of the direct labor costs. Question Content Area a. Prepare a differential analysis dated September 30 to determine whether the company should make (Alternative 1) or buy (Alternative 2) the carrying case. If required, round your answers to two decimal places. If an amount is zero, enter "0". Use a minus sign to indicate a…
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Pizana Computer Company has been purchasing carrying cases for its portable computers at a purchase price of $55 per unit. The company, which is currently operating below full capacity, charges factory overhead to production at the rate of 38% of direct labor cost. The unit costs to produce comparable carrying cases are expected to be as follows: Line Item Description Amount Direct materials $28.00 Direct labor 16.00 Factory overhead (38% of direct labor) 6.08 Total cost per unit $50.08 If Pizana Computer Company manufactures the carrying cases, fixed factory overhead costs will not increase and variable factory overhead costs associated with the cases are expected to be 15% of the direct labor costs. Question Content Area a. Prepare a differential analysis dated May 31 to determine whether the company should make (Alternative 1) or buy (Alternative 2) the carrying case. Round your answers to two decimal places. If an amount is zero, enter "0". Differential…
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Required Information [The following information applies to the questions displayed below.] Patel and Sons Inc. uses a standard cost system to apply factory overhead costs to units produced. Practical capacity for the plant is defined as 55,200 machine hours per year, which represents 27,600 units of output. Annual budgeted fixed factory overhead costs are $276,000 and the budgeted variable factory overhead cost rate is $3.70 per unit. Factory overhead costs are applied on the basis of standard machine hours allowed for units produced. Budgeted and actual output for the year was 21,500 units, which took 44,200 machine hours. Actual fixed factory overhead costs for the year amounted to $264,800 while the actual variable overhead cost per unit was $3.60. Based on the Information provided above, calculate the following factory overhead variances for the year. Indicate whether each variance is favorable (F) or unfavorable (U). (Do not round Intermediate calculations. Round your final…
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