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Salsk061 [2.6K]
3 years ago
11

Hot Dog Express (HDE) is currently buying its buns from Buns-For-All for $0.50 per dozen. Each month, it purchases 14,000 dozen

buns. HDE is considering making its own buns for cost-cutting and quality reasons. It has determined the following costs:
materials, $0.20;
direct labor, $0.10;
variable factory overhead cost, $0.04; and total (existing) fixed costs, $3,000 per month.
Required:
A) From an accounting point of view only, should HDE make or buy its buns?
Business
1 answer:
Greeley [361]3 years ago
3 0

Answer:

Cost of Make = $2,240

Explanation:

The computation of Saving in Cost by Make or buy is shown below:-

                                               Make           Buy

Material                                   $2,800

($0.20 × 14,000 Buns)  

Direct Labor                          $1,400

($0.10 × 14,000 Buns)

Variable Factory Overhead $560

($0.04 × 14,000 Buns)

Purchase Cost of Buns                         $7,000

(14,000 × $ 0.50)

Total Cost                             $4,760      $7,000

Therefore the Saving in Cost by Make = $7,000 - $4,760

= $2,240

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4 0
3 years ago
Managerial accounting is an activity that helps managers determine costs of products and services, plan future activities, and c
Elenna [48]

Answer:

True.

Explanation:

Managerial accounting involves managers using accounting information to better inform themselves before making business decisions. It involves analysing, interpreting and communicating financial data to managers to aid in achievement of organisation's goals.

Managerial accounting is for internal use in the business. Data is modified to meet specific need of the end-user. For example a manager may want to see sales figures for a quarter compared to business target. This will give an idea if the business is meeting it's objectives.

4 0
4 years ago
You’ve recently learned that the company where you work is being sold for $300,000. The company’s income statement indicates cur
chubhunter [2.5K]

Answer:

5%

Explanation:

Data provided in the question:

Present value of the company, PV = $300,000

Current Profits, π₀ = $11,000

Interest rate, i = 9% = 0.09

Now,          

we know,            

PV = \pi_0(\frac{1+i}{1-g})

here,

g is the growth rate        

on rearranging, we get          

g =  i - \frac{(1+i)\pi_0}{PV}

on substituting the respective values, we get

g = 0.09 - \frac{(1+0.09)\times11,000}{300,000}

or  

g = 0.05

or

g = 0.05 × 100%

= 5%

7 0
3 years ago
Inventory is important in the supply chain for many different reasons. Why would you invest the​ company's money for inventory a
Makovka662 [10]

Answer:

All the answers are right

Explanation:

A.To provide a hedge against inflation. : in an inflationary economy, a company can invest in inventory in order to be prepared for the higher prices of raw materials to come. So they can maintain the company´s profit.

B. To tightly synchronize production and distribution processes: inventory of final products can help to minimize the effects of unexpected production problems.

C. To ensure that item cost is maximized: A company can buy a bulk of raw material since the cost of a large number of units is lower. So the final product's cost will be maximized.

D. to tightly synchronize a​ firm's production with its​ customers' demand: for example in a seasonal demand, There are certain months when the demand exceeds the production capacity. In theis case, in the lower season months, the company will be increasing the inventory in order to meet the demand when the high season comes.

6 0
3 years ago
Check out this cube: The figure presents a cube. The length of one edge is labeled as 4 units The figure presents a cube. The le
Olenka [21]

Answer:

The surface area of the cube is 96 squared unit.

Explanation:

The surface area of a cube is the addition of the area of each surfaces. The surface net of the cube illustrates that it has 6 squares of 4 unit length each.

So that,

 Area of a square = length × width

But, length = width

⇒ Area of a square  = (length)^{2}

                              = (4)^{2}

                              = 16

Area of one of the squares of the cube is 16 squared unit.

Surface area of the cube = number of squares × Area of one of the squares of the cube

                                          = 6 ×16

                                          = 96 squared unit

The surface area of the cube is 96 squared unit.

4 0
3 years ago
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