Answer:
A.$42,700 increase
B. Yes
Explanation:
A.
Selling price unit $30
Variable cost unit ( 21)
Logo ( 2)
Contribution margin unit $ 7 x 6,100 units = $42,700 increase
Therefore the increase in net income Maize will realize by accepting the special order, assuming Maize has sufficient excess operating capacity is $42,700
(b) Should Maize Company accept the special order?
YES. Maize company should accept the special order.
Answer:
The indifference point is $17,000
Explanation:
Giving the following information:
Location:
Alpha Ave.:
Fixed Costs= $ 5,000
Variable costs= $ 200 per person
Beta Blvd.:
Fixed costs= $ 8,000
Variable costs= $150 per person
We need to find the indifference point.
Alpha= 5000 + 200*x
Beta= 8000 + 150*x
5000 + 200x=8000 + 150x
50x=3000
x= 60
Answer:
b. $250
Explanation:
In the given case, the marginal cost of firm is $250 per unit.
This marginal cost is constant. When the marginal cost is constant, it reflects the average variable cost.
average variable cost is also $250 per unit.
A firm shuts down when price is less than the average variable cost.
The price can go as lows as $250 per unit before the firm decides to shut down.
If price goes below the $250 per unit then firm will definitely shut down.
Answer:
The managerial accountant found out that the cost of the units previously sold was higher than the selling price per unit.
If the variance is unfavorable, it means that the total budgeted costs were larger than the total budgeted revenue. In this case the variance was $5,600 unfavorable. We are not told how many units were sold but it is obviously a mistake to sell products at a lower price than COGS. So the previous flexible budget was not properly prepared.
Answer:
The answer is a)
Explanation:
When a firm has a complaint case, in all scenarios, the firm should retain the original complaint along with its resolution in the agent's file and send the customer a photocopy of the complaint for traceability in both sides (the 2 companies) but also, send the customer a written apology letter to follow the complaints number and type and retain a copy in the agent's file in case of a posterior reclamation of the same complaint.