Question

Question 3 (25 points) To make a batch of 800 units, it is estimated that 90 direct labor hours are required at a cost of $14

0 0
Add a comment Improve this question Transcribed image text
Answer #1

The cost to purchase = 5*800 = 4000

The cost to manufacture = 90*14+1500+7.5*90 = 3435

As the cost to purchase is greater than the cost to manufacture, the item should be manufactured

option(A)

Add a comment
Know the answer?
Add Answer to:
Question 3 (25 points) To make a batch of 800 units, it is estimated that 90...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Bowser Products operates a small plant in New Mexico that produces dog food in batches of...

    Bowser Products operates a small plant in New Mexico that produces dog food in batches of 1,500 pounds. The product sells for $6 per pound. Standard costs for 2018 are: Standard direct labor cost = $15 per hour Standard direct labor hours per batch = 10 hours Standard price of material A = $0.35 per pound Standard pounds of material A per batch = 800 pounds Standard price of material B = $0.55 per pound Standard pounds of material B...

  • Question 28 2 pts Dallas Company uses a job order costing system. The company's executives estimated that direct...

    Question 28 2 pts Dallas Company uses a job order costing system. The company's executives estimated that direct labor would be $2,000,000 (200,000 hours at $10/hour) and that factory overhead would be $1.500,000 for the current period. At the end of the period, the records show that there had been 180,000 hours of direct labor and $1,200,000 of actual overhead costs. Using direct labor hours as base, what was the predetermined overhead rate? $6.00 per direct labor hour. $7.50 per...

  • PROBLEM 1 The Ram Manufacturing Company produced P100, 000 units during the year ended December 31,...

    PROBLEM 1 The Ram Manufacturing Company produced P100, 000 units during the year ended December 31, 2009. It incurred the following costs for the year Materials​​P75, 000 (10% is indirect materials) Labor​​​P97, 000 (7% is indirect labor) Factory Overhead​125% of direct labor cost WIP – January 1​​P25, 500 WIP – December 31​P27, 000 Required: How much is the Company’s cost of goods manufactured? Problem 2 Donna Company submits the following data for May 2013 Direct labor cost​​P80, 000 Purchases​​P100, 000...

  • z Cont. Batch costs Number of batches Engineering changes Number of engineering hours Total estimated manufacturing...

    z Cont. Batch costs Number of batches Engineering changes Number of engineering hours Total estimated manufacturing overhead for the year $196,000 $188,950 $3,600,200 Total estimated direct labor hours for the company for the year are 100,250 hours. The company is evaluating whether it should use an activity-based costing system in place of its traditional costing system. Additional information about production needed for the activity-based costing system follows: Zips Dees Total Direct labor hours 61,250 39,000 100,250 Batches 2,350 400 2,750...

  • Print item York Company is a machine shop that estimated overhead will be $50,000, consisting of...

    Print item York Company is a machine shop that estimated overhead will be $50,000, consisting of 5,000 hours of direct labor. The cost to make Job 0325 is so in aluminum and two hours of labor at $20 per hour. During the month, York incurs $40 in indirect material cost, $150 in administrative labor, 5290 in utilities, and $240 in depreciation expense A. What is the predetermined overhead rate if direct labor hours are considered the cost driver? per direct...

  • York Company is a machine shop that estimated overhead will be $33,000, consisting of 3,000 hours...

    York Company is a machine shop that estimated overhead will be $33,000, consisting of 3,000 hours of direct labor. The cost to make Job 0325 is $80 in aluminum and two hours of labor at $30 per hour. During the month, York incurs $50 in indirect material cost, $140 In administrative labor, $290 in utilities, and $260 in depreciation expense. A. What is the predetermined overhead rate if direct labor hours are considered the cost driver?! 11.00 per direct labor...

  • Innova uses 1,100 units of the component IMC2 every month to manufacture one of its products....

    Innova uses 1,100 units of the component IMC2 every month to manufacture one of its products. The unit costs incurred to manufacture the component are as follows. Direct materials Direct labor Overhead Total $55.43 38.12 126.50 $220.05 Overhead costs include variable material handling costs of $7.50, which are applied to products on the basis of direct material costs. The remainder of the overhead costs are applied on the basis of direct labor dollars and consist of 60% variable costs and...

  • Edward uses 1,100 units of the component IMC2 every month to manufacture one of its products....

    Edward uses 1,100 units of the component IMC2 every month to manufacture one of its products. The unit costs incurred to manufacture the component are as follows. Direct materials $59.68 Direct labor 39.11 Overhead 126.50 Total $225.29 Overhead costs include various material handling costs of $7.50, which are applied to products on the basis of direct material costs. The remainder of the overhead costs are applied on the basis of direct labor dollars and consist of 60% variable costs and...

  • Innova uses 1,000 units of the component IMC2 every month to manufacture one of its products....

    Innova uses 1,000 units of the component IMC2 every month to manufacture one of its products. The unit costs incurred to manufacture the component are as follows. Direct materials $62.58 Direct labor 39.79 Overhead 126.50 Total $228.87 Overhead costs include variable material handling costs of $7.50, which are applied to products on the basis of direct material costs. The remainder of the overhead costs are applied on the basis of direct labor dollars and consist of 60% variable costs and...

  • Lansing Productions estimated it would use $360 of materials and take 20 hours at $14.50 per...

    Lansing Productions estimated it would use $360 of materials and take 20 hours at $14.50 per hour to complete job 456. It calculated a predetermined overhead rate of $9.00 per direct labor hour. Job 456 required $380 of material and took employees a total of 19.25 hours at a cost of $15.20 per hour to complete the job. Actual manufacturing overhead costs totaled $223,000 for the year for the company. How much is the cost of Job 456? $173.25 $553.25...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT