(a)
Decision-making process:
Decision making can be defined as the process of making choices through the identification of a decision, collecting information, and assessing alternative re Explanations. The implementation of a step-by-step process of decision making helps in making deliberate and effective decisions through proper organization of relevant information and defining alternatives.
To prepare: A per unit analysis of the differential costs and to explain whether Company R must make or buy the sails.
(b)
Decision-making process:
Decision making can be defined as the process of making choices through the identification of a decision, collecting information, and assessing alternative re Explanations. The implementation of a step-by-step process of decision making helps in making deliberate and effective decisions through proper organization of relevant information and defining alternatives.
To determine: Whether R should make or buy the sails, if R suddenly finds an opportunity to rent out the unused capacity of its factory for $77,000 per year.
(c)
Decision-making process:
Decision making can be defined as the process of making choices through the identification of a decision, collecting information, and assessing alternative re Explanations. The implementation of a step-by-step process of decision making helps in making deliberate and effective decisions through proper organization of relevant information and defining alternatives.
To identify: The three qualitative factors that R should consider in make or buy decisions.
Want to see the full answer?
Check out a sample textbook solution
Chapter 7 Solutions
Managerial Accounting: Tools for Business Decision Making
- Caddy Sporting Goods manufactures sleeping bags. The manufacturing standards per sleeping bag, based on 5,000 sleeping bags per month, are as follows: Direct material of 4 yards at $5.75 per yard. Direct labor of 3 hours at $19 per hour. Overhead applied per sleeping bag at $20. In the month of April, the company actually produced 5,200 sleeping bags using 27,300 yards of material at a cost of $5.10 per yard. The labor used was 11,700 hours at an average rate of $18.50 per hour. The actual overhead spending was $96,200. Determine the total materials variance.arrow_forwardchoose best answerarrow_forwardProvide correct cash conversion cycle of this financial accounting questionarrow_forward
- Sandy's Sauces, which produces stir-fry sauces, is developing direct material standards. Each bottle of sauce requires 0.6 kilograms of base. The allowance for waste is 0.7 kilograms per bottle, while the allowance for rejects is 0.8 kilograms per bottle. What is the standard quantity of base per bottle? A. 2.1 kilograms B. 0.6 kilograms C. 1.3 kilograms D. 1.4 kilogramsarrow_forwardYour boss at LK Enterprises asks you to compute the company's cash conversion cycle. Looking at the financial statements, you see that the average inventory for the year was $135,500, accounts receivable were $102,400, and accounts payable were at $121,700. You also see that the company had sales of $356,000 and that cost of goods sold was $298,500. What is your firm's cash conversion cycle? Round to the nearest day. Helparrow_forwardYour boss at LK Enterprises asks you to compute the company's cash conversion cycle. Looking at the financial statements, you see that the average inventory for the year was $135,500, accounts receivable were $102,400, and accounts payable were at $121,700. You also see that the company had sales of $356,000 and that cost of goods sold was $298,500. What is your firm's cash conversion cycle? Round to the nearest day. What is the answer ?arrow_forward
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning