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creativ13 [48]
2 years ago
13

Paxton Company can produce a component of its product that incurs the following costs per unit: direct materials, $9.90; direct

labor, $13.90, variable overhead $2.90 and fixed overhead, $7.90. An outside supplier has offered to sell the product to Paxton for $34.60. Compute the net incremental cost or savings of buying the component.
a.$2.90 cost per unit.
b. $7.90 savings per unit.
c. $0 cost or savings per unit.
d. $7.90 cost per unit.
e. $2.90 savings per unit.
Business
1 answer:
matrenka [14]2 years ago
7 0

Answer:

D) $7.90 cost per unit

Explanation:

This can be calculated by identifying the relevant costs that will be affected by the transaction. $7.9 is a fixed overhead and will be paid regardless of producing the component in house or purchasing from an external source thus this needs to be omitted from the calculation. So the new cost of producing in house is,

Relevant Cost = 9.9 + 13.90 + 2.9 = $26.7

Thus the incremental cost of this transaction would be

Incremental Cost = 34.60 - 26.7 = $7.90

It is not advisable to purchase this as if they do they will have to pay $34.60 for purchase and would also have to absorb $7.90 of fixed overheads bringing the total cost incurred to 34.60 + 7.90 =$42.5

Hope that helps.

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Tom transfers a building that originally cost $40,000 to Paul Corp. in exchange for 100% of the corporation's stock. the adjuste
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Answer:

Gain recognized by Tom is $10000

So option (b) will be correct answer

Explanation :

We have given liability on bulding assumed by Paul Corp = $30,000

Tom's adjusted basis in the building = $20,000

Since the liability assumed by Paul Corp on the building is greater than Tom's adjusted basis, Tom must recognize gain equal to the difference between the liability on the building and his adjusted basis.

So gain recognized by Tom = $30,000 - $20,000 = $10,000

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Mr. Barker enjoys a comfortable retirement income. He recently had surgery and expected that he would have certain services and
olasank [31]

Answer:

What you could tell him is that you can offer to help him review all the plans appeal process as well as to help him ask the plan to review his coverage decision which will enable him to know why he had large charges in excess of his maximum out-of-pocket limit.

Explanation:

Based on the information given we were told that when he received the bill, their was large charges in excess of his maximum out-of-pocket limit which is a limit on the amount of money a person or an individual have to pay for covered medical care services in which we were still told that the large charges in excess of his maximum out-of-pocket limit also include a number of services and items he thought would be fully covered, therefore since he called you to ask what he could do, What you could tell him is that you will offer to help him review all the plans appeal process and to as well help him to ask the plan to review the coverage decision which is why coverage decision is of benefit because it enables a person or an individual to makes decision about their benefits including the amount they have to pay for their medical services plan.

6 0
3 years ago
Define the term creativity​
LekaFEV [45]

Answer:

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3 0
2 years ago
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On April 1, Garcia Publishing Company received $32,580 from Otisco, Inc. for 36-month subscriptions to several different magazin
Oksi-84 [34.3K]

Answer: Debit Unearned Fees, $8,145; Credit Fees Earned, $8,145.

Explanation:

The $32,580 are for 36 months so the amount per month would need to be calculated.

= 32,580/36

= $905

The subscriptions were paid on the 1st of April which means that only 9 months (April to December) of the first year will have revenue recognized for them.

= 905 * 9

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Correct entry would be to debit the Unearned fees account as it is a liability that needs to reduce to reflect that fees have now been recognized.

Credit the Fees Earned account to recognize revenue.

Debit Unearned Fees, $8,145; Credit Fees Earned, $8,145.

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3 years ago
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