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Tasya [4]
3 years ago
10

Sparrow Co. is currently operating at 80% of capacity and is currently purchasing a part used in its manufacturing operations fo

r $8.00 a unit. The unit cost for Sparrow Co. to make the part is $9.00, which includes $0.60 of fixed costs. If 4,000 units of the part are normally purchased each year but could be manufactured using unused capacity, what would be the amount of differential cost increase or decrease for making the part rather than purchasing it? a. $20,000 cost decrease b. $4,000 cost increase c. $1,600 cost increase d. $12,000 cost decrease
Business
1 answer:
ELEN [110]3 years ago
7 0

Answer:

The correct option is C) $1600 cost increase.

Explanation:

COST OF BUYING WOULD BE = 4000 UNITS X $8

                                                    = $32,000

COST FOR MANUFACTURING THE PART WOULD BE =

4000 UNITS X $9 - 4000 UNITS X $.60

here we are subtracting the fixed cost from the total cost of manufacturing,a s only the variable cost would be taken in to account.

= $36,000 - $2400

= $33,600

So the difference between making product and buying product is $1600, therefore there would be increase of cost by $1600.

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Welfare analysis: Basic conceptsIdentify whether each of the following statements best illustrates the concept of consumer surpl
STALIN [3.7K]

Answer:

Producer surplus

Neither

Consumer surplus

Explanation:

Consumer surplus is the difference between the willingness to pay of a consumer and the price of the good.

Producer surplus is the difference between the price of the good and the least price the seller is willing to sell his product.

1. Price = $149

least price seller was willing to sell his laptop = $140.

Hence it's producer surplus.

2. Price = $59

there's no information on the least price the seller was willing to sell or the highest amount the buyer was willing to buy.

hence it's neither producer or consumer surplus

3. Price = $39

highest amount buyer was willing to buy = $46

Hence, it's consumer surplus

I hope my answer helps you

3 0
4 years ago
Both nondeductible contributions to a traditional IRA and contributions to a Roth IRA are similar in the sense that neither prov
Nastasia [14]

Answer:

The answer to this question can be defined as follows:

Explanation:

In part A

When Most citizens can't deductible in tax and their daily IRA donation, when the revenue is higher then all thresholds refer to specific levels. So, It can also pay to save for a non-deductible IRA to your withdrawal. Even if your IRA is not exempt.  

Regulations on IRA Revenue:

When a company provides individuals or their spouse has been decided to hire by users have a 401(k) or 403(b) employee withdrawal account, experience some IRA depreciation contribution limits donations.  

For an alternative to Roth IRA:  

Most individuals have incomes above limits and the  Roth IRA may indeed meet the criteria for a frequent IRA tax benefit and the higher level donation.

In part B

I will also take a glance at the answer from a tax viewpoint if a competent payment decreases subject to tax salaries and further decreases taxable income. It is a great way for both management and workers and employers receive big profits without taxation. Its value of a qualified retirement benefit provided for both the worker increases the amount that can be spent on behalf of the company by providing an eligible program.

4 0
3 years ago
For Wilton Company, the predetermined overhead rate is 70% of direct labor cost. During the month, $360,000 of factory labor cos
bezimeni [28]

Answer:

The amount of overhead debited to Work in Process Inventory should be: a. $182,00

Explanation:

The Overheads are Applied in the Manufacturing Costs as:

Budgeted Rate × Actual Activity for the Month

At the End of the Period we would need to determined whether this amount of overhead is Over or Under Applied by comparing it to the actual overheads incurred of $180,000 (given)

In our Case,  the predetermined overhead rate is 70% of direct labor cost

<em>Thus we need to find the Direct Labor Cost first</em>:

Total Labor Costs               $360,000

<em>Less </em>Indirect Labor Costs<em>  </em>$100,000

Direct Labor Cost              $260,000

<em>Therefore Overheads applied would be determined as:</em>

= $260,000 × 70%

= $182,000

6 0
4 years ago
Read 2 more answers
One thousand dollars is invested at 5% continuous annual interest. This means the value of the investment will grow exponentiall
mamaluj [8]

Answer:

$1454.99

Explanation:

Just did this question the other day

8 0
3 years ago
explain how the looting of shops and malls will affect businesses in terms of the relationship between social responsibility and
ololo11 [35]

The main purpose of  a business is to make profit. A businessmen will feel secure to operate his business activities in a country where he feels himself and his business activities secure.

When the shops and malls are looted in a country, the businessmen will have feeling of insecurity and so they will shut down their business activities because whatever profits they make from running business, it is looted by robbers.

There is always some social responsibility of the citizens that even in case of emergency situations they should not be unethical activities and indulge in criminal activities.

Learn more at brainly.com/question/24383317

8 0
3 years ago
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