Homework Answers
| Req 1 | Normal Volume | Additional Volume | Combined Total | |
| Sales | 7,500,000 | 650,000 | 8,150,000 | |
| Costs and expenses: | ||||
| Direct materials | 1,000,000 | 100,000 | 1,100,000 | |
| Direct labor | 2,000,000 | 200,000 | 2,200,000 | |
| Overhead | 500,000 | 80,000 | 580,000 | |
| Selling expenses | 750,000 | 750,000 | ||
| Administrative expenses | 1,285,000 | 215,000 | 1,500,000 | |
| Total costs and expenses | 5,535,000 | 595,000 | 6,130,000 | |
| Incremental income (loss) from new business | 1,965,000 | 55,000 | 2,020,000 | |
| Req 2 | The company should accept the offer |
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Sales (500,000 units) Costs and expenses Direct materials Direct labor Overhead Selling expenses Administrative expenses Total...
Farrow Co. expects to sell 500,000 units of its product in the next period with the...
Farrow Co. expects to sell 500,000 units of its product in the next period with the following results $7,500,000 Sales (500,000 units) Costs and expenses Direct materials Direct labor Overhead Selling expenses Administrative expenses Total costs and expenses Net income 1,000,000 2,000,000 500,000 750,000 1,285,000 5,535,eee $1,965,000 The company has an opportunity to sell 50.000 additional units at $13 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be...
Farrow Co. expects to sell 500,000 units of its product in the next period with the...
Farrow Co. expects to sell 500,000 units of its product in the next period with the following results. Sales (500,000 units) Costs and expenses 7,500,000 Direct materials Direct labor Overhead Selling expenses Administrative expenses 1,000,000 2,000,000 500,000 750,000 Total costs and expenses Net income $1,965,000 The company has an opportunity to sell 50,000 additional units at $12 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be the same...
Farrow Co. expects to sell 500,000 units of its product in the next period with the...
Farrow Co. expects to sell 500,000 units of its product in the next period with the following results Sales (500,000 units) Costs and expenses $7,500,000 Direct materials Direct labor Overhead Selling expenses Administrative expenses 1,000,e0e 2,000,000 500,000 750,000 1,285,000 5,535,000 $1,965,000 Total costs and expenses Net income The company has an opportunity to sell 50,000 additional units at $13 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be...
Exercise 23-2 Accept new business or not LO A1 Farrow Co. expects to sell 500,000 units...
Exercise 23-2 Accept new business or not LO A1 Farrow Co. expects to sell 500,000 units of Its product In the next period with the following results. Sales (50e.eee units) Costs and expenses $7,580,000 1.800.e0e Direct labor 2.880.000 Overhead 58e.8ee 758,88e e ng expenses penses 5.535.888 Total costs and expenses Net income $1.965,000 The company has an opportunity to sell 50,000 additional units at $12 per unit. The additional sales would not affect Its current expected sales. Direct materlals and...
Goshford Company produces sales of 100,000 units follow. The regular selling a single product and has capacity to...
Goshford Company produces sales of 100,000 units follow. The regular selling a single product and has capacity to produce 125,000 units per month. Costs to produce its current price of the product is $136 per unit. Management is approached by a new customer who wants to purchase 25.000 units of the product for $77.40 per unit. If the order is accepted, there will be no additional fixed ring overhead and no additional fixed selling and administrative expenses. The customer is...
Farrow Co. expects to sell 300,000 units of its product in the next period with the...
Farrow Co. expects to sell 300,000 units of its product in the next period with the following results Sales (300,000 units) Costs and expenses $4,500,000 Direct materials Direct labor Overhead Selling expenses Administrative expenses 600,000 1,200,000 300,000 450,000 771,000 3,321,000 $1,179,000 Total costs and expenses Net income The company has an opportunity to sell 30,000 additional units at $13 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be...
Goshford Company produces a single product and has capacity to produce 100,000 units per month. Costs...
Goshford Company produces a single product and has capacity to produce 100,000 units per month. Costs to produce its current sales of 80,000 units follow. The regular selling price of the product is $100 per unit Management is approached by a new customer who wants to purchase 20,000 units of the product for $75.00 per unit. If the order IS accepted, there will be no additional fixed manufacturing overhead and no additional fixed selling and administrative expenses. The customer is...
Exercise 23-2 Accept new business or not LO A1 Farrow Co. expects to sell 300,000 units...
Exercise 23-2 Accept new business or not LO A1 Farrow Co. expects to sell 300,000 units of its product in the next period with the following results. $4,500,000 Sales (300,000 units) Costs and expenses Direct materials Direct labor Overhead Selling expenses Administrative expenses Total costs and expenses Net income 600,000 1,200,000 300,000 450,000 771,000 3,321,000 $1,179,000 ces The company has an opportunity to sell 30,000 additional units at $12 per unit. The additional sales would not affect its current expected...
Farrow Co. expects to sell 300,000 units of its product in the next period with the...
Farrow Co. expects to sell 300,000 units of its product in the next period with the following results. $4,500,000 Sales (300,000 units) Costs and expenses Direct materials Direct labor Overhead Selling expenses Administrative expenses Total costs and expenses Net income 600,000 1,200,000 300,000 450,000 771,000 3,321,000 $1,179,000 The company has an opportunity to sell 30,000 additional units at $12 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be...
Goshford Company produces a single product and has capacity to produce 130.000 units per month. Costs...
Goshford Company produces a single product and has capacity to produce 130.000 units per month. Costs to produce its current sales of 104,000 units follow. The regular selling price of the product is $130 per unit. Management is approached by a new customer who wants to purchase 26,000 units of the product for $79.20 per unit. If the order is accepted, there will be no additional fixed manufacturing overhead and no additional fixed selling and administrative expenses. The customer is...
Farrow Co. expects to sell 500,000 units of its product in the next period with the following results $7,500,000 Sales (500,000 units) Costs and expenses Direct materials Direct labor Overhead Selling expenses Administrative expenses Total costs and expenses Net income 1,000,000 2,000,000 500,000 750,000 1,285,000 5,535,eee $1,965,000 The company has an opportunity to sell 50.000 additional units at $13 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be...
Farrow Co. expects to sell 500,000 units of its product in the next period with the following results. Sales (500,000 units) Costs and expenses 7,500,000 Direct materials Direct labor Overhead Selling expenses Administrative expenses 1,000,000 2,000,000 500,000 750,000 Total costs and expenses Net income $1,965,000 The company has an opportunity to sell 50,000 additional units at $12 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be the same...
Farrow Co. expects to sell 500,000 units of its product in the next period with the following results Sales (500,000 units) Costs and expenses $7,500,000 Direct materials Direct labor Overhead Selling expenses Administrative expenses 1,000,e0e 2,000,000 500,000 750,000 1,285,000 5,535,000 $1,965,000 Total costs and expenses Net income The company has an opportunity to sell 50,000 additional units at $13 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be...
Exercise 23-2 Accept new business or not LO A1 Farrow Co. expects to sell 500,000 units of Its product In the next period with the following results. Sales (50e.eee units) Costs and expenses $7,580,000 1.800.e0e Direct labor 2.880.000 Overhead 58e.8ee 758,88e e ng expenses penses 5.535.888 Total costs and expenses Net income $1.965,000 The company has an opportunity to sell 50,000 additional units at $12 per unit. The additional sales would not affect Its current expected sales. Direct materlals and...
Goshford Company produces sales of 100,000 units follow. The regular selling a single product and has capacity to produce 125,000 units per month. Costs to produce its current price of the product is $136 per unit. Management is approached by a new customer who wants to purchase 25.000 units of the product for $77.40 per unit. If the order is accepted, there will be no additional fixed ring overhead and no additional fixed selling and administrative expenses. The customer is...
Farrow Co. expects to sell 300,000 units of its product in the next period with the following results Sales (300,000 units) Costs and expenses $4,500,000 Direct materials Direct labor Overhead Selling expenses Administrative expenses 600,000 1,200,000 300,000 450,000 771,000 3,321,000 $1,179,000 Total costs and expenses Net income The company has an opportunity to sell 30,000 additional units at $13 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be...
Goshford Company produces a single product and has capacity to produce 100,000 units per month. Costs to produce its current sales of 80,000 units follow. The regular selling price of the product is $100 per unit Management is approached by a new customer who wants to purchase 20,000 units of the product for $75.00 per unit. If the order IS accepted, there will be no additional fixed manufacturing overhead and no additional fixed selling and administrative expenses. The customer is...
Exercise 23-2 Accept new business or not LO A1 Farrow Co. expects to sell 300,000 units of its product in the next period with the following results. $4,500,000 Sales (300,000 units) Costs and expenses Direct materials Direct labor Overhead Selling expenses Administrative expenses Total costs and expenses Net income 600,000 1,200,000 300,000 450,000 771,000 3,321,000 $1,179,000 ces The company has an opportunity to sell 30,000 additional units at $12 per unit. The additional sales would not affect its current expected...
Farrow Co. expects to sell 300,000 units of its product in the next period with the following results. $4,500,000 Sales (300,000 units) Costs and expenses Direct materials Direct labor Overhead Selling expenses Administrative expenses Total costs and expenses Net income 600,000 1,200,000 300,000 450,000 771,000 3,321,000 $1,179,000 The company has an opportunity to sell 30,000 additional units at $12 per unit. The additional sales would not affect its current expected sales. Direct materials and labor costs per unit would be...
Goshford Company produces a single product and has capacity to produce 130.000 units per month. Costs to produce its current sales of 104,000 units follow. The regular selling price of the product is $130 per unit. Management is approached by a new customer who wants to purchase 26,000 units of the product for $79.20 per unit. If the order is accepted, there will be no additional fixed manufacturing overhead and no additional fixed selling and administrative expenses. The customer is...
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