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Andre45 [30]
3 years ago
12

Homestead Jeans Co. has an annual plant capacity of 65,000 units, and current production is 45,000 units. Monthly fixed costs ar

e $54,000, and variable costs are $29 per unit. The present selling price is $42 per unit. On November 12 of the current year, the company received an offer from Dawkins Company for 18,000 units of the product at $32 each. Dawkins Company will market the units in a foreign country under its own brand name. The additional business is not expected to affect the domestic selling price or quantity of sales of Homestead Jeans Co.
Required:
a. Prepare a differential analysis dated November 12 on whether to reject (Alternative 1) or accept (Alternative 2) the Dawkins order.
b. Briefly explain the reason why accepting this additional business will increase operating income.
c. What is the minimum price per unit that would produce a positive contribution margin?
Business
1 answer:
ioda3 years ago
4 0

Answer:

18000*2

Explanation:

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A mother earned ​$ 18750.00 18750.00 from royalties on her cookbook. She set aside​ 20% of this for a down payment on a new home
BARSIC [14]

Answer:

a) $ 5000, $ 10000 b) $ 5000

Explanation:

The royalties money = $18750

She set aside 20% for new home  which = 0.2 × 18750 = $ 3750

Amount remaining = 18750 - 3750 = $15000

She invested a sum in a bank certificate of deposit

let the amount invested in bank certificate = y

profit from the investment in the bank = 0.04y

second investment amount = 15000 - y

profit of investment = 0.07 ( 15000 - y)

sum of the two profit  = 0.04y + 0.07 (15000 - y) = total profit = $ 900

0.04y + 0.07 (15000 - y) = 900

open the bracket and rearrange the equation

0.04y + 1050 - 0.07y = 900

0.04y - 0.07y = 900 - 1050

-0.03y = -150

divide both side by -0.03

y = -150 / -0.03 = $ 5000

The amount of money invest at 4% is $5000

The amount of money invested at 7% = 15000 - 5000 = $10000

The amount of money invested in CD account = $ 5000

3 0
3 years ago
The Southern Corporation manufactures a single product and has the following cost structure: Variable costs per unit: Production
Blizzard [7]

Answer:

$3,500

Explanation:

Under variable costing method, product costs are calculated on variable manufacturing  costs only.

Step 1 : Determine unit Product Cost

Product Cost = Variable Manufacturing Costs

                      =  $ 35

Step 2 : Determine the units in Inventory

Units in Inventory = Opening Stock + Production - Sales

                              = 0 +  7,210 - 7,110

                              = 100 units

Step 3 : Determine Inventory value

Inventory value = Units x Cost per unit

                           = 100 units x $ 35

                           = $3,500

Conclusion :

the ending inventory of finished goods under variable costing would be: $3,500

3 0
2 years ago
Which of the following statements is correct regarding the predictability of analytical procedures in a financial statement audi
Pie

Answer:

The answer is letter B

Explanation:

Relationships involving income statement accounts tend to be more predictable than relationships involving only balance sheet accounts.

Because analytical procedures are evaluations of financial information made by study of plausible relationships among financial and nonfinancial data using models that range from simple to complex.  The reason is that income statement amount is based on transactions over a period of time, but balance sheet amounts are for a moment in time. Moreover, amounts subject to management discretion tend to be less predictable.

5 0
3 years ago
The George Company has a policy of maintaining an end-of-month cash balance of at least $37,000. In months where a shortfall is
amid [387]

Answer:

  1. $140
  2. $14,140

Explanation:

1. First find the net amount amount the company borrowed in April:

= Cash balance to be maintained + Loan repayment - Budgeted end of April balance

= 37,000 + 1,000 - 24,000

= $14,000

Interest = 14,000 * 12%/ 12 months

= $140

2. Financing effect:

= Amount borrowed + Interest

= 14,000 + 140

= $14,140

6 0
3 years ago
In the Keynesian-cross model, actual expenditures differ from planned expenditures by the amount of:
dmitriy555 [2]

Answer: Option (c) is correct.

Explanation:

Correct option: Unplanned inventory investment.

Unplanned inventory investment is a component of investment spending. The other component of investment spending is planned inventory investment.

Unplanned inventory investment occurs when actual sales are more or less than the company's expected sales which results in unplanned changes occurred in the inventories.

Hence, in the Keynesian-cross model, actual expenditures differ from planned expenditures by the amount of Unplanned inventory investment.

5 0
3 years ago
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