View PoliciesCurrent Attempt in ProgressSunland Company produces 1000 units of a necessary componentwith the following costs:Direct Materials $34000Direct Labor15000Variable Overhead7000Fixed Overhead10000ortSunland Company could avoid $6000 in fixed overhead costs if itacquires the components externally. If cost minimization is themajor consideration and the company would prefer to buy thecomponents, what is the maximum external price that SunlandCompany would accept to acquire the 1000 units externally?O $59000O $62000O $60000O$56000

Total Cost: Total cost is the actual amount of costs incurred by a company for producing a given…

Answered: View Policies Current Attempt in…

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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Similar questions

806Praveen Co. manufactures and markets a number of rope products. Management is considering the future of Product XT, a special rope for hang gliding, that has not been as profitable as planned. Since Product XT is manufactured and marketed independently of the other products, its total costs can be precisely measured. Next year’s plans call for a $200 selling price per 100 yards of XT rope. Its fixed costs for the year are expected to be $270,000, up to a maximum capacity of 700,000 yards of rope. Forecasted variable costs are $140 per 100 yards of XT rope.RequiredEstimate Product XT’s break-even point in terms of (a) sales units and (b) sales dollars.Check (1a) Break-even sales, 4,500 unitsPrepare a contribution margin income statement showing sales, variable costs, and fixed costs for Product XT at the break-even point.
Vaughn Music produces 60800 blank CDs on which to record music. The CDs have the following costs Direct Materials $10600 Direct Labour 14800 Variable Overhead 2800 Fixed Overhead 6800 None of Vaughni's foxed overhead costs can be reduced, but another product could be made that would increase the operating income by $4400 if the CDs were acquired externally If cost minimization is the major consideration and the company would prefer to buy the CDs, what is the maximum external price that Vaughn would be willing to accept to acquire the 60800 units externally
A4
Concord Corporation can produce 100 units of a necessary component part with the following costs: Direct Materials $23000 Direct Labor 9000 Variable Overhead Fixed Overhead 25000 O $50000 O $57000 O $62000 O $64000 12000 If Concord Corporation purchases the component externally, $5000 of the fixed costs can be avoided. Below what external price for the 100 units would Concord choose to buy instead of make the units?
Your Company is considering the addition of a new product to its current product lines. The expected cost and revenue data for the new product are as follows: Annual sales in units 3,000 Selling price per unit $309 Variable costs per unit: Production $130 Selling $50 Traceable annual fixed costs: Production $51,000 Selling $75,000 Allocated annual fixed cost $54,000 If the new product is added to the existing product line, then sales of existing products will decline. As a consequence, the contribution margin of the existing product lines is expected to drop $78,000 per year. What is the increase in net income if the new product is added next year? This is a reverse drop the segment. New CM is positive and new FC and lost CM are negative.
Swifty's Manufacturing Company can make 100 units of a necessary component part with the following costs: Direct Materials Direct Labor Variable Overhead Fixed Overhead $117000 22000 49000 30000 If Swifty's Manufacturing Company purchases the component externally, $20000 of the fixed costs can be avoided. What is the maximum amount Swifty is willing to pay to purchase the 100 units? $218000 O $188000 $198000 $208000
Blue Spruce Tech produces 60,000 iPhone adapters with the following costs:

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