X Ltd., having an installed capacity of 1,00,000 units of a product is currently operating at 70% utilisation. At current levels of input prices, the FOB unit costs (after taking credit for applicable export incentives) work out as follows : Capacity utilisation FOB unit costs per cent 70 97 80 92 90 87 100 82 The Company has received three foreign offers from different sources as under : Source A Source B Source C Advise the company as to whether any or all the export orders should be accepted or not. 5,000 units at $55 per unit FOB 10,000 units at $52 per unit FOB 10,000 units at $51 per unit FOB

X Ltd., having an installed capacity of 1,00,000 units of a product is currently operating at 70% utilisation. At current levels of input prices, the FOB unit costs (after taking credit for applicable export incentives) work out as follows : Capacity utilisation FOB unit costs per cent 70 97 80 92 90 87 100 82 The Company has received three foreign offers from different sources as under : Source A Source B Source C Advise the company as to whether any or all the export orders should be accepted or not. 5,000 units at $55 per unit FOB 10,000 units at $52 per unit FOB 10,000 units at $51 per unit FOB

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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Company E has two divisions, Division A and Division B. Division A is currently buying Component X from an external seller for $14. Division B produces Component X and has excess capacity. Using the following data, what would the transfer price per unit if Division A purchased Component X from Division B at the full-cost plus assuming 15% transfer price? Variable cost per unit $7.16 Fixed cost per unit 1.14 Division B sales price of Component X 14.5
Use this information for Stryker Industries to answer the question that follow. Stryker Industries received an offer from an exporter for 30,000 units of product at $19 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $23 Unit manufacturing costs: Variable 10 Fixed 5 What is the amount of income or loss from the acceptance of the offer? Oa. $300,000 loss Ob. $690,000 loss Oc. $570,000 income Od. $270,000 income Previous Next 7:36 PM CP 12/13/2020
Jacoby Company received an offer from an exporter for 20,500 units of product at $19 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $24 Unit manufacturing costs: Variable $9 Fixed $5 What is the differential revenue from the acceptance of the offer? a.$389,500 b.$881,500 c.$102,500 d.$492,000
Stryker Industries received an offer from an exporter for 24,000 units of product at $18 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data is available: Domestic unit sales price $21 Unit manufacturing costs: Variable 11 Fixed 6 What is the amount of income or loss from acceptance of the offer? a.$168,000 b.$264,000 c.$504,000 d.$432,000
Stryker Industries received an offer from an exporter for 21,000 units of product at $19 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $23 Unit manufacturing costs: Variable Fixed 9 4 The amount of profit or loss from acceptance of the offer is a a. $483,000 Ob. $189,000 ○ c. $399,000 Od. $210,000
Jacoby Company received an offer from an exporter for 29,500 units of product at $18 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Line Item Description Amount Domestic unit sales price $25 Unit manufacturing costs: Variable 9 Fixed 4 The differential revenue from the acceptance of the offer is a. $1,268,500 b. $206,500 c. $737,500 d. $531,000
Jacoby Company received an offer from an exporter for 26,200 units of product at $19 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $24 Unit manufacturing costs: Variable Fixed 10 d. $131,000 3 The differential revenue from the acceptance of the offer is O a. $628,800 O b. $497,800 Oc. $1,126,600 O
Stryker Industries received an offer from an exporter for 26,000 units of product at $16 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $22 Unit manufacturing costs: Variable Fixed 13 6 The amount of profit or loss from acceptance of the offer is a Oa. $78,000 Ob. $338,000 Oc. $416,000 Od. $572,000
Company E has two divisions, Division A and Division B. Division A is currently buying Component X from an external seller for $12. Division B produces Component X and has excess capacity. Using the following data, what would the transfer price per unit if Division A purchased Component X from Division B at the market-based transfer price? • Variable cost per unit $10 • Fixed cost per unit 1.16 • Division B sales price of Component X 14.50
Division X makes a part with the following characteristics: Production capacity.. 25,000 units $18 Selling price to outside customers. Variable cost per unit. $11 Fixed cost, total. $100,000 Division Y of the same company would like to purchase 10,000 units each period from Division X. Division Y now purchases the part from an outside supplier at a price of $17 each. Suppose that Division X is operating at capacity and can sell all of its output to outside customers. If Division X sells the parts to Division Y at $17 per unit, the company as a whole will be: Select one: a. better off by $10,000 each period. b. worse off by $20,000 each period. C. worse off by $10,000 each period. d. There will be no change in the status of the company as a whole.
Stryker Industries received an offer from an exporter for 21,000 units of product at $17 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $21 Unit manufacturing costs: Variable Fixed 9 4 The differential cost from the acceptance of the offer is O a. $189,000 O b. $441,000 O c. $84,000 O d. $357,000
Bonita Company manufactures a product with a unit variable cost of $43 and a unit sales price of $75. Fixed manufacturing costs were $79500 when 7950 units were produced and sold, equating to $10 per unit. The company has a one-time opportunity to sell an additional 1000 units at $54 each in an international market, which would notaffect its present sales. The company has sufficient capacity to produce the additional units. How much is the relevant income effect of accepting the special order? $43000 $1000 $11000 $7950