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Lady bird [3.3K]
3 years ago
13

A company contemplating the acceptance of a special order has the following unit cost behavior, based on 10,000 units: Direct ma

terials $ 4 Direct labor 10 Variable overhead 8 Fixed overhead 6 A foreign company wants to purchase 2,000 units at a special unit price of $25. The normal price per unit is $40. In addition, a special stamping machine will have to be purchased for $4,000 in order to stamp the foreign company’s name on the product. The incremental income (loss) from accepting the order is
Business
1 answer:
Ymorist [56]3 years ago
7 0

Answer:

Increase in  income= 2,000

Explanation:

Giving the following information:

Unit cost behavior, based on 10,000 units: Direct materials $ 4 Direct labor 10 Variable overhead 8 Fixed overhead 6. A foreign company wants to purchase 2,000 units at a special unit price of $25. Also, a special stamping machine will have to be purchased for $4,000.

Because it is a special offer from a foreign company and assuming that there is unused capacity, we will not have into account the previous fixed costs.

Unitary costs= 4 + 10 + 8= 22

Fixed cost= 4000

Sales= 2000*25= 50,000

Variable cost= 22*2000= 44,000

Fixed cost= 4,000

Net operating income= 2,000

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il63 [147K]

Answer:

Lease Equipment $150,000

BUY EQUIPMENT$134,700

Differential Effects-$15,300

The company should choose BUY EQUIPMENT which is Alternative 2

Explanation:

Preparation of the differential analysis dated March 15 to determine whether Laredo Corporation should lease (Alternative 1) or purchase (Alternative 2) the equipment

Differential Analysis

Lease (Alt. 1) or Buy (Alt. 2) Equipment

March 15

Lease Equipment (Alternative 1); Buy Equipment

(Alternative 2); Differential Effects (Alternative 2)

Costs:

Purchase price $0 $120,000 $120,000

Freight and installation $0 $1,500 $1,500

Repair and maintenance (6 years) $0 $13,200.$13,200

($2,200*6=$13,200)

Lease (6 years) $150,000 $0 -$150,000

($25,000*6)

Total costs $150,000 $134,700 -$15,300

Based on the above calculation the company should choose BUY EQUIPMENT which is Alternative 2

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3 years ago
What journal should a company uses to capture cash transactions?
alexira [117]
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7 0
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As manager of Kids Skids, Meghan wants to develop her relationship management skills. In order to do this, she learns how to
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Answer:

The correct answer is E

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So, Ben is the victim of phishing, as the fraud is done with him by sending the emails.

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Charlotte and Regina are opening a new business venture to sell gourmet cupcakes. One of the important characteristics in starti
AnnZ [28]

Answer:

a. limited liability for members.

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