Tobit Financing offers short-term financing plans to other companies. It buys the accounts of other companies at a discount and
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Solution :
Particulars
Volume
3500 3500
Variable cost
Direct material
Acrylic sheet
Regular $288,000
Deluxe $210,000
Assembly kits
Regular $40,000
Deluxe $17,500
Total $561,300 $555,500 $5800 U
Direct Labor
Regular $80,000
Deluxe $52,500
Total 130,800 $132,500 $1700 F
Variable overhead
Regular $20,000
Deluxe $13,125
Total $34,625 $33,125 1500 U
Fixed overhead 48,150 $46,000 2150 U
Total $774,875 $767,125 7750 U
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<u>Working</u>
Regular Deluxe
8000 3500
Direct Material:
Acrylic sheets(8000 x 36);(3500 x 60) $288,000 $210,000
Assembly kit (8000 x 50); (3500 x 5) $40,000 $ 17500
Direct labor
(8000 x 10) ; (3500 x 15) $80,000 $52,500
Variable overhead
(8000 x 2.50);( 3500 x 3.75) $ 20,000 $ 13,125