subject
Business, 06.05.2021 20:50 tiannaetzel

Lion Company makes 10,000 units per year of a part it uses in the products it manufactures. The unit product cost of this part is computed as follows: Direct materials $ 12 Direct labor $ 20 Variable manufacturing overhead $ 10 Fixed manufacturing overhead: supervisory salaries $ 2 depreciation of special equipment $ 3 allocated manufacturing overhead $ 6 Unit product cost $ 53 An outside supplier has offered to sell the company all of these parts it needs for $42 a unit. The special equipment has no resale value or alternative use. The $6 allocated manufacturing overhead cost being applied to the part would be applied to the company's other products if the part were purchased from the outside supplier. (1). What is the net total dollar advantage or disadvantage of purchasing the 10,000 units of the part rather than making it? Please show all calculations and label items clearly. (2). What is the maximum amount the company should be willing to pay an outside supplier per unit for the part if the supplier commits to supplying all 10,000 units required each year?

ansver
Answers: 2

Another question on Business

question
Business, 22.06.2019 01:30
Monica needs to assess the slide sequence and make quick changes to it. which view should she use in her presentation program? a. outline b. slide show c. slide sorter d. notes page e. handout
Answers: 1
question
Business, 22.06.2019 09:40
Newton industries is considering a project and has developed the following estimates: unit sales = 4,800, price per unit = $67, variable cost per unit = $42, annual fixed costs = $11,900. the depreciation is $14,700 a year and the tax rate is 34 percent. what effect would an increase of $1 in the selling price have on the operating cash flow?
Answers: 2
question
Business, 22.06.2019 11:40
Jamie is saving for a trip to europe. she has an existing savings account that earns 3 percent annual interest and has a current balance of $4,200. jamie doesn’t want to use her current savings for vacation, so she decides to borrow the $1,600 she needs for travel expenses. she will repay the loan in exactly one year. the annual interest rate is 6 percent. a. if jamie were to withdraw the $1,600 from her savings account to finance the trip, how much interest would she forgo? .b. if jamie borrows the $1,600 how much will she pay in interest? c. how much does the trip cost her if she borrows rather than dip into her savings?
Answers: 1
question
Business, 22.06.2019 21:00
Describe what fixed costs and marginal costs mean to a company.
Answers: 1
You know the right answer?
Lion Company makes 10,000 units per year of a part it uses in the products it manufactures. The unit...
Questions
Questions on the website: 13722363