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MariettaO [177]
3 years ago
13

Taser Industries must decide whether to make or buy some of its components. The costs of producing 175,000 battery packs for its

product are as follows: Direct Materials $15,000 Direct Labor $5,000 Variable overhead $6,000 Fixed overhead $9,000 The company has an opportunity to purchase the battery packs for $0.18 per unit, which would eliminate all variable costs, and $2,000 of fixed costs. Based on your analysis, what is the net income increase or decrease if the company purchases the battery packs
Business
1 answer:
Andrei [34K]3 years ago
6 0

Answer:

It is cheaper to produce in-house. Cost savings= $3500

Explanation:

We need to find whether it is better to produce in-house or to purchase to a supplier.

Q= 175000

Produce in house:

Direct Materials $15,000

Direct Labor $5,000

Variable overhead $6,000

Fixed overhead $9,000

Total cost= $35000

Outsource:

Purchase Cost= 175000q*$0.18= $31500

Fixed Cost= (9000-2000)= $7000

Total cost=$38500

It is cheaper to produce in-house. Cost savings= $3500

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Diversification is important in investing because "It helps you to balance your risk across different types of investments".

Explanation:

Diversification is a risk management approach that includes investing beyond or within various asset types to depreciate the ups and downs of economic exchanges. In different terms, diversification is thereby not owning all your eggs in one basket. Diversification goes by expanding properties beyond and within various asset types. Because asset types have their own individual financial rounds, when one class is making substantial profits, another may not be functioning as well. By expanding your purchases beyond and within distinct asset categories you’ll be in an immeasurable situation to offset the buoyancy of unique expenses.

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Crich Corporation uses direct labor-hours in its predetermined overhead rate. At the beginning of the year, the estimated direct
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Answer:

$1,524 underapplied

Explanation:

Predetermined overhead rate = Estimated Manufacturing Overhead ÷ Estimated Activity.

                                                  = $560,324 ÷ 22,060

                                                  = $25.40

Applied Overheads = Predetermined overhead rate × Actual Activity

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                                = $558,800

<em>Where,</em>

Actual Overheads are  $560,324 (given)

<em>Conditions :</em>

If Actual Overheads > Applied Overheads, we say overheads are under-applied and if Actual Overheads < Applied Overheads, we say that overheads are over-applied.

<em>Therefore ,</em>

In our case, Actual Overheads : $560,324 > Applied Overheads : $558,800. Overheads have been under-applied by $1,524 ($560,324 - $558,800).

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Answer:

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In law, there are different terminologies and phrases that have specific meaning, some of them are as follows;

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