Question

i need help with corrections to make these red X’s go away. please provide explaination!

board X RO C D E F G Exercise 4 Golf Co made 3,000 novelty golf balls last year. The balls normally sell for $7 each. The costs per ball were as follows: H $1.00 $0.50 Direct materials Direct labor Overhead Selling expenses Total cost per ball $4.00 $0.50 $6.00 This year an overseas company approached Golf Co and asked them to sell an 900 golf balls at $6 each. The sale isn't expected to affect current sales. Most of Golf Co's overhead is fixed, but variable overhead costs are $1.2 per unit. Selling expenses will increase to $1.10 per unit on the special order. Complete the table to determine the incremental profit on the order. Accept Reject Sales Direct materials Direct labor Overhead Selling expenses Profit $1 $1,980 What is the incremental profit on the order? Should Golf Co accept the order? ves 6 7 8 9 DQ eS EX PR BYN Type here to search

Answer 1

) Roto Sales 6.00 D. Materials Di labour 0. 50 V. OIH 1. 20 Selling exp 1-10 - Profit per unrt 2.20 units = 900 Total 'proft = 2.200 900 = $1980 Hence, Golf (o. should accept the order. A @ (3 Cont... margin ($) D. labours (hrs) Prod 64.00 2 Prod B 88.08 3 Podc 96.00 u © conta. morgin per hour ($) 32.00 29.36 24.00 - Demord Cunits) 640 1280 @ Toral nous read (bxd) 1,280 3,840 3520. V Allocation of 7200 hrs. 1,280_ 3840_ 2016 (Balonce a Sales mix (4:5) Cunely) 640 1,980 520

wholesalers i Alternative 1: Sell to Revenue = 4000 x 40 = $ 160,000. Alternative 2 : Rework and sale Sales = 4,000 X 56 = 224,000 (a Rowork east = (24,800) - Revenue $199,200 financial impact : - Rowork and sale will increase (199,200-160,000) $ 39,200, the proft Hence, Bruce Co should go for rework.