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Lana71 [14]
3 years ago
6

A company manufactures various sized plastic bottles for its medicinal product. The manufacturing cost for small bottles is $67

per unit (100 bottles), including fixed costs of $22 per unit. A proposal is offered to purchase small bottles from an outside source for $35 per unit, plus $5 per unit for freight. Prepare a differential analysis dated March 30 to determine whether the company should make (Alternative 1) or buy (Alternative 2) the bottles, assuming that fixed costs are unaffected by the decision. If an amount is zero, enter "0". For those boxes in which you must enter subtracted or negative numbers use a minus sign.
Business
1 answer:
VLD [36.1K]3 years ago
6 0

Answer:

The company should buy from an outside source rahter than manufacturing because each bottle manufactured costs $5 more.

Explanation:

Differential Analysis

                                                          Make            Buy

Manufacturing Cost per bottle         $ 67

Purchasing Cost per bottle                                  $35

Freight per bottle                                                  $ 5

<u>Fixed Costs                                                            $ 22   </u>

<u>Total                                                   $ 67              $62   </u>

<u />

The company should buy the bottles from the  outside source because the manufacturing costs are higher than the purchasing costs and the fixed costs.

The fixed costs are the irrelevant costs that will continue whether bottles are manufactured or purchased.

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Westkost [7]

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4 years ago
If annual demand is 50,000 units, the ordering cost is $25 per order, and the holding cost is $5 per unit per year, which of the
Mama L [17]

Answer:

B) 708

Explanation:

The computation of the economic order quantity is shown below:

Data given in the question

Annual demand = 50,000 units

Ordering cost per order = $25

Holding cost per unit = $5

= \sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}

=\sqrt{\frac{2\times \text{5,000}\times \text{\$25}}{\text{\$4}}}

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8 0
3 years ago
Text Problem 5
Alik [6]

Answer:

Please find the answer in the attached image

Explanation:

Please find attached the table used in answering this question

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4 0
4 years ago
A company's product sells at $12.30 per unit and has a $5.45 per unit variable cost. The company's total fixed costs are $96,500
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Answer:

Break-even point in units= 14,088 units

Explanation:

Giving the following information:

A company's product sells at $12.30 per unit and has a $5.45 per unit variable cost. The company's total fixed costs are $96,500.

To calculate the break-even point in units, we need to use the following formula:

Break-even point in units= fixed costs/ contribution margin per unit

Break-even point in units= 96,500/ (12.3 - 5.45)

Break-even point in units= 14,088 units

4 0
4 years ago
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agasfer [191]

Answer:

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Explanation:

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