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tatyana61 [14]
3 years ago
13

July Company currently outsources a relay switch that is a component in one of its products. The switches cost $20 each. The com

pany is considering making the switches internally at the following projected annual production costs: Unit-level material cost $ 3 Unit-level labor cost $ 2 Unit-level overhead $ 1 Batch-level set-up cost (5,000 units per batch) $ 25,000 Product-level supervisory salaries $ 37,500 Allocated facility-level costs $ 20,000 The company expects an annual need for 5,000 switches. If the company makes the product, it will have to utilize factory space currently being leased to another company for $1,500 a month. Moreover the company would need to hire an additional supervisor. If the company decides to make the parts, total costs will be:
Business
1 answer:
Ulleksa [173]3 years ago
3 0

Answer:

$10,500

Explanation:

The computation of Total cost is shown below:-

Unit cost =  (Total income tax expense +  Unit-level overhead + Batch-level set-up cost) × Units per batch

= ($3 + $2 + $1) × 5,000

= $6 × 5,000

= $30,000

Total incremental cost = Unit cost + Batch level set up cost + Product level Supervisory salaries + Rental income

= $30,000 + $25,000 + $37,500 + $18,000

= $110,500

Now, Present cost = Switches cost × Units per batch

= $20 × 5,000

= $100,000

Net increase in cost = Total incremental cost - Present cost

= $110,500 - $100,000

= $10,500

Therefore for computing the net increase in cost we simply deduct the present cost from total incremental cost.

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BabaBlast [244]

Answer:

$9583.89

Explanation:

value of each payment (P): $2,100

interest rate per period (r): 12/100 = 0.12

number or periods (n): 7

present value of annuity (PV): ??

using the annuity formula: PV = P * \frac{1 - (1 + r )^{-n} }{r}

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Gourmet Shop purchased cash registers on April 1 for $18,000. If this asset has an estimated useful life of five years, what is
algol13

Answer:

$17,400

Explanation:

Given that,

Purchased cash registers on April 1 = $18,000

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Using straight line depreciation method,

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= (Original cost - Salvage cost) ÷ Estimated useful life

= ($18,000 - $0) ÷ 5

= $3,600 per year

Two months depreciation:

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= $3,600 × (1 ÷ 6)

= $600

Book value of the cash registers on May 31:

= Original cost - Two months depreciation

= $18,000 - $600

= $17,400

7 0
2 years ago
Connie, a single mother and home-business entrepreneur, enjoys running her own business. However, because she is busy balancing
VladimirAG [237]

Connie can best be described as Solo Operator type of entrepreneur.

Explanation:

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This is happening because she is a sole operator as in she has to take all the decisions and do all the work by herself with no additional help from anyone else whatsoever in the family or the work front either.

7 0
3 years ago
The primary goal of the consumer financial protection bureau is everfi answer
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Match each of the following terms with their definition - Before-tax cost of debt - Cost of preferred stock - Cost of Common Sto
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Answer:

Before-tax cost of debt ⇒ A. The interest rate the firm must pay on new long-term borrowing.

This refers to the interest rate that a firm will pay on long term borrowing as compensation to the lenders for lending the company some funds.

Cost of preferred stock ⇒ C. rate of return investors require based on the preferred stock dividend.

The cost of the preferred stock is the rate of the preferred dividend that investors require they are paid every year if dividends can be paid and sometimes even when it cannot.

Cost of Common Stock ⇒ B. the rate of return on retained earnings, and adjusted for flotation costs .

Commons stock costs is the required return on the retained earnings of a company.

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