Homework Answers
Cost if switches are purchased = 8,000*35 = 280,000
Cost if switches are made
= (7+6+5)*8,000 + 50,000 + 50,000 + rent (4,000*12 months) = 292,000
So, if company makes the switches, cost will be higher by 12,000
(280,000-292,000)
Option A is the answer
Add Answer to:
Benitez Company currently outsources a relay switch that is a component in one of its products....
Benitez Company currently outsources a relay switch that is a component in one of its products....
Benitez Company currently outsources a relay switch that is a component in one of its products. The switches cost $23 each. The company is considering making the switches internally at the following projected annual production costs: Unit-level material cost $ 4 Unit-level labor cost $ 3 Unit-level overhead $ 2 Batch-level set-up cost (6,000 units per batch) $ 32,000 Product-level supervisory salaries $ 41,000 Allocated facility-level costs $ 27,000 The company expects an annual need for 6,000 switches. If the...
Safety Products currently outsources an electrical switch that is a component in its sprinkler systems. The...
Safety Products currently outsources an electrical switch that is a component in its sprinkler systems. The switches are purchased for $36 each. The company is considering making the switches internally and has conducted a study to determine the costs involved. The costs below are projected annual production costs: Unit-level material cost Unit-level labor cost Unit-level overhead Batch-level cost (5,000 units per batch) Product-level supervisory salaries Allocated facility-level costs $21,000 $45,500 $36,000 Assume that the company needs 10,000 of the switches,...
M and M, Inc produces a product that has a variable cost of $4.50 per unit....
M and M, Inc produces a product that has a variable cost of $4.50 per unit. The company's fixed costs are $56,000 The product is sold for $8 per unit and the company desires to earn a target praft of $17,500. What is the amount of sales t calculations that will be necessary to earn the desired proft? (Do not round intermediate Benitez Company currently outsources a relay switch that is a component in one of its products. The switches...
Current-Control Inc. manufactures a variety of electrical switches. The company is currently manufacturing all of its...
Current-Control Inc. manufactures a variety of electrical
switches. The company is currently manufacturing all of its own
component parts. An outside supplier has offered to sell a switch
to Current-Control for $32 per unit. To evaluate this offer,
Current-Control has gathered the following information relating to
its own cost of producing the switch internally:
Per
Unit
12,000 Units
per Year
Direct materials
$ 12
$144,000
Direct labour
10
120,000
Variable manufacturing overhead
3
36,000
Fixed manufacturing overhead, traceable
8*
96,000...
Haver Company currently produces component RX5 for its sole product. The current cost per unit to...
Haver Company currently produces component RX5 for its sole product. The current cost per unit to manufacture the required 50,000 units of RX5 follows. Direct materials Direct labor Overhead Total costs per unit $ 5.00 8.00 9.00 $22.00 Direct materials and direct labor are 100% variable. Overhead is 80% fixed. An outside supplier has offered to supply the 50,000 units of RX5 for $18.00 per unit. Required: 1. Determine the total incremental cost of making 50,000 units of RX5. 2....
Haver Company currently produces component RX5 for its sole product. The current cost per unit to...
Haver Company currently produces component RX5 for its sole product. The current cost per unit to manufacture the required 50.000 units of RX5 follows. Direct materials $ 5.00 Direct labor Overhead Total costs per unit $22.00 8.00 9.00 Direct materials and direct labor are 100% variable. Overhead is 80% fixed. An outside supplier has offered to supply the 50,000 units of RX5 for $18.00 per unit. Required: 1. Calculate the incremental costs of making and buying component RX5. Total incremental...
Your Corporation is presently making a part that is used in one of its products. A...
Your Corporation is presently making a part that is used in one of its products. A total of 8,000 units of this part are produced and used every year. The company's Accounting has the following costs of producing the part at this level of activity: Direct materials. $3.70 Direct labor $1.00 Variable overhead $6.90 Supervisors salary $8.80 Depreciation of special equipment. $3.30 Allocated general overhead. $1.60 An outside supplier has offered to produce and sell the part to the company...
Haver Company currently produces component RX5 for its sole product. The current cost per unit to...
Haver Company currently produces component RX5 for its
sole product.
The current cost per unit to manufacture the required 57,000 units
of
RX5 follows.
Direct materials and direct labor are 100% variable. Overhead is
80%
fixed. An outside supplier has offered to supply the 57,000 units
of
RX5 for $19.00 per unit.
Required:
1. Determine the total incremental cost of making 57,000 units of
RX5.
2. Determine the total incremental cost of buying 57,000 units of
RX5.
3. Should the...
Company used to consider a traditional costing system based on machine hours; however, they are currently...
Company used to consider a traditional costing system based on machine hours; however, they are currently considering an activity-based costing (ABC) approach. The company estimates the usage of 50,000 direct labor hours (DLH) and 30,000 machine hours (MH) for the current year. The following data show the budgeted manufacturing overhead (OH): Activity center Cost driver Activity driver Cost Material handling # of parts handled 6,000,000 $720,000 Setup costs # of setups 750 $315,000 Machining costs # of machine hours 30,000...
Problem 8-24 Wright Water Co. is a leading producer of greenhouse irrigation systems. Currently, the company manuf...
Problem 8-24 Wright Water Co. is a leading producer of greenhouse irrigation systems. Currently, the company manufactures the timer unit used in each of its systems. Based on an annual production of 50,000 timers, the company has calculated the following unit costs. Direct fixed costs include supervisory and clerical salaries and equipment depreciation. $13 Direct materials Direct labor Variable manufacturing overhead Direct fixed manufacturing overhead Allocated fixed manufacturing overhead Total unit cost 4 7 (40% salaries, 60% depreciation) 8 Clifton...
Safety Products currently outsources an electrical switch that is a component in its sprinkler systems. The switches are purchased for $36 each. The company is considering making the switches internally and has conducted a study to determine the costs involved. The costs below are projected annual production costs: Unit-level material cost Unit-level labor cost Unit-level overhead Batch-level cost (5,000 units per batch) Product-level supervisory salaries Allocated facility-level costs $21,000 $45,500 $36,000 Assume that the company needs 10,000 of the switches,...
M and M, Inc produces a product that has a variable cost of $4.50 per unit. The company's fixed costs are $56,000 The product is sold for $8 per unit and the company desires to earn a target praft of $17,500. What is the amount of sales t calculations that will be necessary to earn the desired proft? (Do not round intermediate Benitez Company currently outsources a relay switch that is a component in one of its products. The switches...
Current-Control Inc. manufactures a variety of electrical
switches. The company is currently manufacturing all of its own
component parts. An outside supplier has offered to sell a switch
to Current-Control for $32 per unit. To evaluate this offer,
Current-Control has gathered the following information relating to
its own cost of producing the switch internally:
Per
Unit
12,000 Units
per Year
Direct materials
$ 12
$144,000
Direct labour
10
120,000
Variable manufacturing overhead
3
36,000
Fixed manufacturing overhead, traceable
8*
96,000...
Haver Company currently produces component RX5 for its sole product. The current cost per unit to manufacture the required 50,000 units of RX5 follows. Direct materials Direct labor Overhead Total costs per unit $ 5.00 8.00 9.00 $22.00 Direct materials and direct labor are 100% variable. Overhead is 80% fixed. An outside supplier has offered to supply the 50,000 units of RX5 for $18.00 per unit. Required: 1. Determine the total incremental cost of making 50,000 units of RX5. 2....
Haver Company currently produces component RX5 for its sole product. The current cost per unit to manufacture the required 50.000 units of RX5 follows. Direct materials $ 5.00 Direct labor Overhead Total costs per unit $22.00 8.00 9.00 Direct materials and direct labor are 100% variable. Overhead is 80% fixed. An outside supplier has offered to supply the 50,000 units of RX5 for $18.00 per unit. Required: 1. Calculate the incremental costs of making and buying component RX5. Total incremental...
Haver Company currently produces component RX5 for its
sole product.
The current cost per unit to manufacture the required 57,000 units
of
RX5 follows.
Direct materials and direct labor are 100% variable. Overhead is
80%
fixed. An outside supplier has offered to supply the 57,000 units
of
RX5 for $19.00 per unit.
Required:
1. Determine the total incremental cost of making 57,000 units of
RX5.
2. Determine the total incremental cost of buying 57,000 units of
RX5.
3. Should the...
Problem 8-24 Wright Water Co. is a leading producer of greenhouse irrigation systems. Currently, the company manufactures the timer unit used in each of its systems. Based on an annual production of 50,000 timers, the company has calculated the following unit costs. Direct fixed costs include supervisory and clerical salaries and equipment depreciation. $13 Direct materials Direct labor Variable manufacturing overhead Direct fixed manufacturing overhead Allocated fixed manufacturing overhead Total unit cost 4 7 (40% salaries, 60% depreciation) 8 Clifton...
Most questions answered within 3 hours.
-
Supposing Delta is an example of a very large US commercial
airline, how does the magnitude...
asked 3 minutes ago -
The total amount of shares that a corporation's charter allows
it to issue is:
Issued.
Authorized....
asked 4 minutes ago -
Which of the following statements is false? Explain what is
wrong with the statement.
a. A...
asked 11 minutes ago -
Vincent Simmons appeals from the trial court's order awarding to
his wife, Dorothy Simmons, a one-half...
asked 13 minutes ago -
A group of researchers has developed a method that they
hypothesize will improve the reading ability...
asked 14 minutes ago -
When 1 Liter volumes of the below solutions are mixed, which
will result in the precipitation...
asked 16 minutes ago -
A truck moving at 45 m/s passes a police car moving at 36 m/s in
the...
asked 15 minutes ago -
By using specific examples, explain how multinational firms
balance (or not as the case may be)...
asked 17 minutes ago -
Given X ~ Exp(1/8), we survey 100 at a time and are interested
in the distribution...
asked 35 minutes ago -
The size of an array declaration must be know by the computer at
_______ time.
runtime...
asked 24 minutes ago -
Discuss at least two examples of scientific methods in
Biology
asked 30 minutes ago -
At a point high in the Earth's atmosphere, He2+ ions in a
concentration of 2.7×1012/m3 are...
asked 43 minutes ago