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snow_tiger [21]
4 years ago
11

Milford Corporation has in stock 16,100 kilograms of material R that it bought five years ago for $5.75 per kilogram. This raw m

aterial was purchased to use in a product line that has been discontinued. Material R can be sold as is for scrap for $3.91 per kilogram. An alternative would be to use material R in one of the company's current products, S88Y, which currently requires 2 kilograms of a raw material that is available for $7.60 per kilogram. Material R can be modified at a cost of $0.77 per kilogram so that it can be used as a substitute for this material in the production of product S88Y. However, after modification, 4 kilograms of material R is required for every unit of product S88Y that is produced. Milford Corporation has now received a request from a company that could use material R in its production process. Assuming that Milford Corporation could use all of its stock of material R to make product S88Y or the company could sell all of its stock of the material at the current scrap price of $3.91 per kilogram, what is the minimum acceptable selling price of material R to the company that could use material R in its own production process?
Business
1 answer:
kati45 [8]4 years ago
3 0

Answer:

Therefore the company should sell material R for $3.91 per kilogram.

Explanation:

Product S88Y:

Current cost (2 kg × $7.60)

=$15.20

Thus If material R were to be used, that means 4 kilograms would be needed.

Hence It currently costs $15.20 for Product S88Y to maintain this same cost.

Therefore material R would be:

[($15.20 ÷ 4 kg) − $0.77]

=3.8kg-$0.77

=$3.03 per kg

Therefore the company should go ahead and sell material R for $3.91 per kilogram.

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Answer:

11.62%

Explanation:

Note: see the attached excel file for how the realized rate of return is estimated.

Face value = $1,000  

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Download xlsx
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3 years ago
"which group of organizational participants has the most vague job description?"
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3 years ago
Typically banks rely on other banks to lend reserves to one another. Which interest rate do they charge for these loans
soldier1979 [14.2K]

Answer:

Federal funds rate

Explanation:

federal funds rate is simply known as the interest rate at which depository financial institutions borrows(lends) funds maintained at the federal reserve to other depository financial institutions usually or Maybe overnight.

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5 0
3 years ago
Standard Direct Materials Cost per Unit from Variance Data The following data relating to direct materials cost for October of t
statuscvo [17]

Answer:

The standard cost is $5 per lbs

each units uses 2 lbs, so the unit stadard cost is $10

Explanation:

Volume variance

(standard\:quantity-actual\:quantity) \times standard \: cost = DM \: efficiency \: variance

std quantity                   2800.00  (1,400 units times 2 pounds per unit)

actual quantity           3000.00

std cost                                     ??

(2,800-3,000) \times standard \: cost = -1,000

difference                     -200.00

efficiency variance        $(1,000.00)

-200 x Std cost = -1,000

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Answer:

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Explanation:

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6 0
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