Answer:
Given that,
Total prepaid insurance = $6,700
Monthly insurance:
= Total prepaid insurance ÷ 4 months
= $6,700 ÷ 4 months
= $1,675
Insurance expense for two months:
= $6,700 - $1,675
= $5,025
Therefore, the adjusting entry required on December 31 is as follows:
Insurance expense A/c Dr. $5,025
To Prepaid insurance $5,025
(To record the adjusting entry for the insurance)
Here, we are decide the best option between making the part or buying the part.
a. Make or Buy Analysis
Particulars Make amount Buy amount
Direct Materials $4.50
Direct Labor $1.00
Overhead (80% of Direct Labor) $0.80
Cost to buy <u> </u> <u>$4.70</u>
Cost per unit <u>$5.70 </u> <u>$4.70</u>
Cost Difference = $5.70 - $4.70
Cost Difference = $1.00
Therefore, the cost difference of making amount over buying amount is $1.00.
b. Because of the difference, Beto should buy the part because its cost is lesser than to make the part.
Therefore, the buying of the part is the best decision.
See similar solution about Analysis
<em>brainly.com/question/23287319</em>
Answer:
INCREASE
Hope I help!!!
