Faster Company manufactures a product with the following costs per unit at the expected production level...
Faster Company manufactures a product with the following costs per unit at the expected production level of 45000 units:
Direct materials $12
Direct labor $20
Variable manufacturing overhead $9
Fixed manufacturing overhead $7
The company has the capacity to produce 50000 units. The product regularly sells for $55.
Refer to the Figure above. A wholesaler has offered to pay $45 a unit for 6000 units. If the special order is accepted, the effect on operating income would be a
-
A decrease by $15000
-
B increase by $15000
-
C decrease by $0
-
D decrease by $60000
Homework Answers
Operating profit will increase by 10,000
| Existing | If Special order is accepted | |
| Regular Price Contribution Margin | 630,000.00 | 616,000.00 |
| Special Price contribution Margin | 24,000.00 | |
| Total | 630,000.00 | 640,000.00 |
pls note there will be no change in the Fixed cos
Add Answer to:
Faster Company manufactures a product with the following costs
per unit at the expected production level...
Rexeleg Company manufactures a product with the following costs per unit at the expected production of...
Rexeleg Company manufactures a product with the following costs per unit at the expected production of 40,000 units: Direct materials $5 Direct labor 10 Variable overhead 7 Fixed overhead 9 The company has the capacity to produce 50,000 units. The product regularly sells for $50. A wholesaler has offered to pay $43 per unit for 3,000 units. If the firm chooses to accept the special order and reject some regular sales, the effect on operating income would be a: a.$30,000...
Please show work. thank you Golden Industries manufactures a product with the following cost per unit...
Please show work. thank you
Golden Industries manufactures a product with the following cost per unit at the expected production of 50000 units. $8.66 11.17 Direct materials Direct labour Variable manufacturing overhead Fixed manufacturing overhead 4.99 7.04 The company has the capacity to produce 60000 units. The product regularly sells for $37.19. A regular customer has requested Golden Industries to provide a quote for a special order of 5752 units Ir Golden would like the special order to make a...
It costs your company SR26 per unit (SR18 variable and SR8 fixed) to produce its product,...
It costs your company SR26 per unit (SR18 variable and SR8 fixed) to produce its product, which normally sells for SR38 per unit. A foreign wholesaler offers to purchase 3,000 units at SR21 each. The company would incur special shipping costs of SR2 per unit if the order were accepted. The company has sufficient unused capacity to produce the 3,000 units. If the special order is accepted, it will decrease the net income (SR3,000). Opinion Justification
5. Floral Company manufactures and sells a single product called Gizmo. Operating at capacity, the company...
5. Floral Company manufactures and sells a single product called Gizmo. Operating at capacity, the company can produce and sell 30,000 Gizmos per year. Costs associated with this level of production and sales are given below: Unit $15 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit The Gizmo normally sells for $45 each. Fixed manufacturing overhead is constant at $270,000. Due to the recession this year, Floral Company expects to produce and sell only...
ACME company manufactures 20,000 bass-o-matic blenders. The company incurs $12/unit of variable costs and $4/unit if...
ACME company manufactures 20,000 bass-o-matic blenders. The company incurs $12/unit of variable costs and $4/unit if fixed costs at this level if production and sells each for $35. A foreign wholesaler offers to purchase 3,000 blenders at $15 each. ACME would incur special shipping costs of $1 each if the order were accepted. ACME has the capacity to produce an additional 5,000 blenders. If the special order is accepted, what will be the effect on net income? A) $45,000 increase...
Peter company produces a product with the following unit cost : Direct Material Direct Labour Variable...
Peter company produces a product with the following unit cost : Direct Material Direct Labour Variable overhead Fixed Overhead Unit cost S 2.75 1.25 4.00 2.50 10.50 Fixed selling costs are $600.000 per year and variable selling costsare $1.50 per unit sol Production capacity is 500.000 units per year. However, the company expects to produc only 300,000 units per year. The product normally sells for $15 each. A customer has offered to buy 150.000 units for $10. The units would...
LL company budgeted 100,000 units for production during 2019. The following cost per unit information is...
LL company budgeted 100,000 units for production during 2019. The following cost per unit information is available: direct material = $5, direct labour = $10, variable manufacturing overhead = $4. Fixed manufacturing overhead for the year = $300,000. LL sells at $50 per unit, market price. It received a special order for 10,000 units from a new customer in a country in which LL has never done business. This customer has offered special order price at $25 per unit. If...
The Colin Division of Mochrie Company sells its product for $37 per unit. Variable costs per unit are...
The Colin Division of Mochrie Company sells its product for $37 per unit. Variable costs per unit are: manufacturing, $14; and selling and administrative, $4. Fixed costs are: $420000 manufacturing overhead, and $57000 selling and administrative. There was no beginning inventory. Expected sales for next year are 60000 units. Ryan Stiles, the manager of the Colin Division, is under pressure to improve the performance of the Division. As he plans for next year, he has to decide whether to produce 60000 units or 70000 units. What would the manufacturing...
Hixson Company manufactures and sells one product for $34 per unit. The company maintains no beginning...
Hixson Company manufactures and sells one product for $34 per unit. The company maintains no beginning or ending inventories and its relevant range of production is 20,000 units to 30,000 units. When Hixson produces and sells 25,000 units, its unit costs are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Amount Per Unit $8.00 $5.00 $1.00 $6.00 $3.50 $2.50 $4.00 $1.00
he following information relates to a product produced by Faulkland Company. Direct materials Direct labor Variable...
he following information relates to a product produced by Faulkland Company. Direct materials Direct labor Variable overhead Fixed overhead Unit cost Fixed selling costs are $1.070.000 per year. Variable selling costs of $5 per unit sold are added to cover the transportation cost. Although production capacity is 570.000 units per year, Faulkland expects to produce only 470.000 units next year. The product normally sells for $55 each A customer has offered to buy 67.000 units for $46 each. The customer...
Please show work. thank you
Golden Industries manufactures a product with the following cost per unit at the expected production of 50000 units. $8.66 11.17 Direct materials Direct labour Variable manufacturing overhead Fixed manufacturing overhead 4.99 7.04 The company has the capacity to produce 60000 units. The product regularly sells for $37.19. A regular customer has requested Golden Industries to provide a quote for a special order of 5752 units Ir Golden would like the special order to make a...
5. Floral Company manufactures and sells a single product called Gizmo. Operating at capacity, the company can produce and sell 30,000 Gizmos per year. Costs associated with this level of production and sales are given below: Unit $15 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total cost per unit The Gizmo normally sells for $45 each. Fixed manufacturing overhead is constant at $270,000. Due to the recession this year, Floral Company expects to produce and sell only...
Peter company produces a product with the following unit cost : Direct Material Direct Labour Variable overhead Fixed Overhead Unit cost S 2.75 1.25 4.00 2.50 10.50 Fixed selling costs are $600.000 per year and variable selling costsare $1.50 per unit sol Production capacity is 500.000 units per year. However, the company expects to produc only 300,000 units per year. The product normally sells for $15 each. A customer has offered to buy 150.000 units for $10. The units would...
Hixson Company manufactures and sells one product for $34 per unit. The company maintains no beginning or ending inventories and its relevant range of production is 20,000 units to 30,000 units. When Hixson produces and sells 25,000 units, its unit costs are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Amount Per Unit $8.00 $5.00 $1.00 $6.00 $3.50 $2.50 $4.00 $1.00
he following information relates to a product produced by Faulkland Company. Direct materials Direct labor Variable overhead Fixed overhead Unit cost Fixed selling costs are $1.070.000 per year. Variable selling costs of $5 per unit sold are added to cover the transportation cost. Although production capacity is 570.000 units per year, Faulkland expects to produce only 470.000 units next year. The product normally sells for $55 each A customer has offered to buy 67.000 units for $46 each. The customer...
Most questions answered within 3 hours.
-
You are investigating an arson scene and you find a corpse in
the rubble, but you...
asked 7 minutes ago -
Do you agree with Hegel that human history exhibits progress?
Does human history exhibit the kind...
asked 11 minutes ago -
1. Ashton Company began the year with a zero balance in its
Supplies General Ledger account....
asked 9 minutes ago -
Can someone help me please:
Discuss Facebook's policies from a privacy perspective. What
does it do...
asked 8 minutes ago -
Like a good economist, you calculated the opportunity cost of
getting your college degree. Suppose that...
asked 15 minutes ago -
A 1500 kg car drives around a flat circular track at a constant
speed of 75...
asked 39 minutes ago -
The operations manager of a mail order house purchases double
(D) and twin (T) beds for...
asked 1 hour ago -
Maths
asked 2 hours ago -
Maths
asked 2 hours ago -
1. You have genotyped an entire population of lab mice for a
single locus (let's label...
asked 3 hours ago -
As part of the process for improving the quality of their cars,
Toyota engineers have identified...
asked 3 hours ago -
What is the relationship between the number of coils in a
solenoid and the emf induced...
asked 3 hours ago