1.
a.
To calculate: The amount and cost of unused manufacturing capacity.
Given information:
Actual units of capacity at starting of 2014 is 250 units
Actual units sold in 2014 are 210 units.
Conversion cost per unit of capacity is $8,100
b.
To calculate: The amount and cost of unused selling and customer-service capacity.
Given information:
Selling and customer service capacity at starting of 2014 is 100 customers.
Selling and customer service capacity in 2014 is 80 customers.
Selling and customer service capacity cost per customer is $9,900.
2.
To calculate: The maximum amount of cost that S could save in 2014 by downsizing manufacturing capacity.
Given information:
Conversion cost per unit of capacity is $8,100.
Downsizing the manufacturing capacity by 30 units.
3.
To identify: The reason for not downsize the capacity.
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Cost Accounting, Student Value Edition (15th Edition)
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