Homework Answers
Total cost of purchase = ($93.75 X 1,000) + ($19,000 - 7%) = $111,420
Total cost to make = $103,000
Total cost to make is less than Total cost to purchase.
If purchases net income will reduce by $8,420 (ie. $111,420 - $103,000)
Option D.
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W.T. Ginsburg Engine Company manufactures part ACT31107 used in several of its engine models. Monthly production...
W.T. Ginsburg Engine Company manufactures part ACT31107 used in several of its engine models. Monthly production costs...
W.T. Ginsburg Engine Company manufactures part ACT31107 used in several of its engine models. Monthly production costs for 1,040 units are as follows: Direct materials Direct labor Variable overhead costs Fixed overhead costs Total costs $41,000 11,500 32,500 21,000 $106,000 It is estimated that 9% of the fixed overhead costs assigned to ACT31107 will no longer be incurred if the company purchases ACT31107 from the outside supplier. W.T. Ginsburg Engine Company has the option of purchasing the part from an...
W.T. Ginsburg Engine Company manufactures part ACT31107 used in several of its engine models. Monthly production...
W.T. Ginsburg Engine Company manufactures part ACT31107 used in several of its engine models. Monthly production costs for 1,040 units are as follows: Direct materials Direct labor Variable overhead costs Fixed overhead costs Total costs $46,000 11,500 34,500 23,000 $115,000 It is estimated that 10% of the fixed overhead costs assigned to ACT31107 will no longer be incurred if the company purchases ACT31107 from the outside supplier. W.T. Ginsburg Engine Company has the option of purchasing the part from an...
6) W.T. Ginsburg Engine Company manufactures part ACT30107 used in several of its engine models. Monthly...
6) W.T. Ginsburg Engine Company manufactures part ACT30107 used in several of its engine models. Monthly production costs for 1,090 units are as follows: Direct materials Direct labor Variable overhead costs Fixed overhead costs Total costs $46,000 10,500 32,500 22,000 $111,000 It is estimated that 6% of the fixed overhead costs assigned to ACT30107 will no longer be incurred if the company purchases ACT30107 from the outside supplier. W.T Ginsburg Engine Company has the option of purchasing the part from...
o points Question 1 Genent's Engine Company manufactures part TE456 used in several of its engine...
o points Question 1 Genent's Engine Company manufactures part TE456 used in several of its engine models. Monthly production costs for 1060 units are as follows: Direct materials $43,000 Direct laber 9500 Variable overhead costs 32,500 Fixed overhead costs 21.000 Totalcouts $106.000 It is estimated that 10% of the fixed overhead costs assigned to TE456 will no longer be incurred if the company purchases TE456 from the outside supplier. Genent's Engine Company has the option of purchasing the part from...
Fair Engineering Company manufactures part QE 767 used in several of its engine models. Monthly production...
Fair Engineering Company manufactures part QE 767 used in several of its engine models. Monthly production costs for 10,000 units are as follows: Direct materials Direct labor Variable support costs Fixed support costs Total costs $ 80,000 20,000 50,000 40,000 $190,000 It is estimated that 20% of the fixed support costs assigned to part QE767 will no longer be incurred if the company purchases the part from the outside supplier. Fair Engineering Company has the option of purchasing the part...
United Co manufactures part X12 used in several of its truck models. 1,000 units are produced...
United Co manufactures part X12 used in several of its truck models. 1,000 units are produced each year with production costs as follows: Direct materials $ 70,000 Direct manufacturing labor 50,000 Variable support costs 40,000 Fixed support costs 80,000 Total costs $240.000 The company has the option of purchasing part X12 from an outside supplier at $200 per unit. If X12 is outsourced, 30% of the fixed costs cannot be immediately converted to other us Required: a. Describe avoidable costs...
Preston Industries, Inc. currently manufactures part QX100, which is used in several products produced by the...
Preston Industries, Inc. currently manufactures part QX100, which is used in several products produced by the company. Monthly production costs for 10,000 units of QX100 are as follows: Direct materials Direct labor Variable overhead costs Fixed overhead costs Total manufacturing costs $ 82,000 $ 13,000 $ 40,000 $ 44,000 $179,000 Accounting has estimated that 20% of the fixed overhead costs currently assigned to QX100 would not be needed if the company chose to purchase the part from an outside supplier....
Han Products manufactures 25,000 units of part S-6 each year for use on its production line....
Han Products manufactures 25,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: 4,70 Direct materials Direct labor 8.00 3.40 Variable manufacturing overhead Fixed manufacturing overhead 15.00 $31.10 Total cost per part An outside supplier has offered to sell 25,000 units of part S-6 each year to Han Products for $50.00 per part. If Han Products accepts this offer, the facilities now being used...
Han Products manufactures 16,000 units of part S-6 each year for use on its production line....
Han Products manufactures 16,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: Direct materials $ 4.10 Direct labor 6.00 Variable manufacturing overhead 2.50 Fixed manufacturing overhead 15.00 Total cost per part $ 27.60 An outside supplier has offered to sell 16,000 units of part S-6 each year to Han Products for $43.00 per part. If Han Products accepts this offer, the...
Han Products manufactures 22,000 units of part S-6 each year for use on its production line....
Han Products manufactures 22,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per part $ 5.30 7.00 2.80 9.00 $ 24.10 An outside supplier has offered to sell 22,000 units of part S-6 each year to Han Products for $42.50 per part. If Han Products accepts this offer, the facilities now...
W.T. Ginsburg Engine Company manufactures part ACT31107 used in several of its engine models. Monthly production costs for 1,040 units are as follows: Direct materials Direct labor Variable overhead costs Fixed overhead costs Total costs $41,000 11,500 32,500 21,000 $106,000 It is estimated that 9% of the fixed overhead costs assigned to ACT31107 will no longer be incurred if the company purchases ACT31107 from the outside supplier. W.T. Ginsburg Engine Company has the option of purchasing the part from an...
W.T. Ginsburg Engine Company manufactures part ACT31107 used in several of its engine models. Monthly production costs for 1,040 units are as follows: Direct materials Direct labor Variable overhead costs Fixed overhead costs Total costs $46,000 11,500 34,500 23,000 $115,000 It is estimated that 10% of the fixed overhead costs assigned to ACT31107 will no longer be incurred if the company purchases ACT31107 from the outside supplier. W.T. Ginsburg Engine Company has the option of purchasing the part from an...
6) W.T. Ginsburg Engine Company manufactures part ACT30107 used in several of its engine models. Monthly production costs for 1,090 units are as follows: Direct materials Direct labor Variable overhead costs Fixed overhead costs Total costs $46,000 10,500 32,500 22,000 $111,000 It is estimated that 6% of the fixed overhead costs assigned to ACT30107 will no longer be incurred if the company purchases ACT30107 from the outside supplier. W.T Ginsburg Engine Company has the option of purchasing the part from...
o points Question 1 Genent's Engine Company manufactures part TE456 used in several of its engine models. Monthly production costs for 1060 units are as follows: Direct materials $43,000 Direct laber 9500 Variable overhead costs 32,500 Fixed overhead costs 21.000 Totalcouts $106.000 It is estimated that 10% of the fixed overhead costs assigned to TE456 will no longer be incurred if the company purchases TE456 from the outside supplier. Genent's Engine Company has the option of purchasing the part from...
Fair Engineering Company manufactures part QE 767 used in several of its engine models. Monthly production costs for 10,000 units are as follows: Direct materials Direct labor Variable support costs Fixed support costs Total costs $ 80,000 20,000 50,000 40,000 $190,000 It is estimated that 20% of the fixed support costs assigned to part QE767 will no longer be incurred if the company purchases the part from the outside supplier. Fair Engineering Company has the option of purchasing the part...
United Co manufactures part X12 used in several of its truck models. 1,000 units are produced each year with production costs as follows: Direct materials $ 70,000 Direct manufacturing labor 50,000 Variable support costs 40,000 Fixed support costs 80,000 Total costs $240.000 The company has the option of purchasing part X12 from an outside supplier at $200 per unit. If X12 is outsourced, 30% of the fixed costs cannot be immediately converted to other us Required: a. Describe avoidable costs...
Preston Industries, Inc. currently manufactures part QX100, which is used in several products produced by the company. Monthly production costs for 10,000 units of QX100 are as follows: Direct materials Direct labor Variable overhead costs Fixed overhead costs Total manufacturing costs $ 82,000 $ 13,000 $ 40,000 $ 44,000 $179,000 Accounting has estimated that 20% of the fixed overhead costs currently assigned to QX100 would not be needed if the company chose to purchase the part from an outside supplier....
Han Products manufactures 25,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: 4,70 Direct materials Direct labor 8.00 3.40 Variable manufacturing overhead Fixed manufacturing overhead 15.00 $31.10 Total cost per part An outside supplier has offered to sell 25,000 units of part S-6 each year to Han Products for $50.00 per part. If Han Products accepts this offer, the facilities now being used...
Han Products manufactures 22,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per part $ 5.30 7.00 2.80 9.00 $ 24.10 An outside supplier has offered to sell 22,000 units of part S-6 each year to Han Products for $42.50 per part. If Han Products accepts this offer, the facilities now...
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