1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
zysi [14]
3 years ago
11

The Varone Company makes a single product called a Hom. The company has the capacity to produce 40,000 Homs per year. Per unit c

osts to produce and sell one Hom at that activity level are: Direct materials $20 Direct labor $10 Variable manufacturing overhead $5 Fixed manufacturing overhead $7 Variable selling expense $8 Fixed selling expense $2 The regular selling price for one Hom is $60. A special order has been received at Varone from the Fairview Company to purchase 8,000 Homs next year at 15% off the regular selling price. If this special order were accepted, the variable selling expense would be reduced by 25%. However, Varone would have to purchase a specialized machine to engrave the Fairview name on each Hom in the special order. This machine would cost $10,800 and it would have no use after the special order was filled. The total fixed costs, both manufacturing and selling, are constant within the relevant range of 30,000 to 40,000 Homs per year. Assume direct labor is a variable cost. If Varone has an opportunity to sell 37,960 Homs next year through regular channels and the special order is accepted for 20% off the regular selling price, the effect on net operating income next year due to accepting this order would be:________
a. $33,320 decrease
b. $35,480 decrease
c. $33,320 increase
d. $35,480 increase
Business
1 answer:
djyliett [7]3 years ago
3 0

Answer:

$69,200 Increase

Explanation:

Calculation to determine what the effect on net operating income next year due to accepting this order would be:

Incremental revenue $408,000

(8,000 units × $51 per unit)

[$60 × (1 − 15%) = $51]

Less incremental costs:

Direct materials $160,000

(8,000 units × $20 per unit)

Direct labor $80,000

(8,000 unit × $10 per unit)

Variable manufacturing overhead $40,000

(8,000 units × $5per unit)

Variable selling expense $48,000

[$8 × (1 − 25%) = $6]

(8,000 units × $6 per unit)

Special machine $10,800

Total incremental cost $338,800

Incremental net operating income$69,200

($408,000-$338,800)

Therefore the effect on net operating income next year due to accepting this order would be:

$69,200 Increase

You might be interested in
Her neighbor could not afford to repair the roof on her house, so tijuana secretly hired and paid for a contractor to repair the
BaLLatris [955]

Tijuana's actions are an example of <u> "altruism".</u>


Altruism is carrying on of worry for another's prosperity. Regularly, individuals carry on charitably when they see others in edgy conditions and feel sympathy and a craving to help. Selflessness doesn't generally easily fall into place, since by definition, it expects individuals to slight their very own worries to help other people with no desire for remuneration, however "reciprocal altruism" is a term utilized by evolutionary scholars and analysts to describe the choice to help with a desire that one will get some advantage or result to oneself. Agreeable conduct enabled our predecessors to make due under brutal conditions, despite everything it fills an important need to an exceedingly mind boggling society.

8 0
3 years ago
Prepare the journal entries to record the assignment of direct materials and direct labor and the allocation of manufacturing ov
rosijanka [135]

Answer:

Note: The full question is attached below

Date      Accounts Title and Explanation        Debit     Credit

Mar-31   WIP-Fermenting Department            $15,971

                     Raw Material Inventory                                $9,288

                     Wages payable                                             $3,305

                     Manufacturing Overhead                             $3,378

              (Being cost assigned to WIP-Fermenting department)

3 0
2 years ago
Look at the following email (attached). Name two good email netiquette practices used in the
Kipish [7]

Two good email etiquettes practices used in email are:

  • Inserting a Subject
  • Keep the email short and restricted to three paragraphs.

Two bad email etiquettes used in the email above are:

  • Indiscriminate use of the exclamation mark
  • Discussing personal issues in a formal email.

<h3>What are email etiquettes?</h3>

The use of acceptable language, standards, and politeness in an email is referred to as email etiquette. Business emails often need formal language as well as rigorous respect to appropriate grammar and spelling.

Five useful E-mail Etiquette are:

  • Address your addressee appropriately. Check, double-check, and triple-check that you have the right spelling of the recipient's name and title.
  • Proper greetings and closing statements should be used.
  • Format correctly.
  • Avoid using ALL CAPS.
  • Large files should be compressed.

Learn more about email etiquette:
brainly.com/question/11498233
#SPJ1

8 0
1 year ago
Assuming that the standard fixed overhead rate is based on full capacity, the cost of available but unused productive capacity i
ioda

Answer: a.fixed factory overhead volume variance.

Explanation:

Fixed overhead costs are the costs that are incurred by an organization that doesn't change even when the lre is a change in the volume of production activity. The fixed overhead costs are vital in order for the effective operation of the company.

When the standard fixed overhead rate is based on full capacity, the cost of available but unused productive capacity is indicated by the a.fixed factory overhead volume variance.

8 0
3 years ago
you wish to buy a $25,000 car. the dealer offers you a 4-year loan with a 9 percent apr. what are the monthly payments?
NeTakaya

In order to buy a car worth $25,000 a monthly payment of $622.12 is required.

Mortgages are one type of loan that frequently has a structure that calls for a stream of identical monthly payments. The lender can assess whether the customer's budget can support equal monthly payments by doing so.

Suppose the monthly payment is M.

With 9 percent APR, the effective monthly rate is 9%/12 = 0.75%.

There will be 12 x 4 years, or 48 monthly payments.

The face value of the loan must be equal to the present value of these monthly payments, or

{}\sum_{t=1}^{48}{\frac{M}{(1 + 0.75\%)^t}} = 25,000, {}

which yields M = 622.12.

If you only paid interest, the monthly payment would be calculated as follows: principal * monthly interest rate (9% /12) = 25,000*0.75% = 187.5.

The results would be that after five years, you would still owe the whole amount of $25,000 and would have to pay $11,250 in interest.

Learn more about loans:

brainly.com/question/11794123

#SPJ4

4 0
1 year ago
Other questions:
  • The relationship between quantity supplied and price is _____, and the relationship between quantity demanded and price is _____
    12·1 answer
  • In the monetarist view, the long-run Phillips curve is____________.
    14·1 answer
  • Why are healthy individual finances important to the Economy in North America?
    14·1 answer
  • A new restaurant has introduced a wildly popular macaroni and cheese dish made with goat cheese. however, at approximately the s
    10·2 answers
  • At an activity level of 9,000 machine-hours in a month, Kirk Corporation's total variable production engineering cost is $796,50
    6·1 answer
  • Steve, the vice president of Ocher Inc., plans to introduce a retirement plan for all employees. George, the operations director
    15·1 answer
  • Derek, the general manager of a software firm, is known to be a modest person. He accepts responsibility for his mistakes and ke
    11·1 answer
  • What type of cover letter written in response to a posted job opening?
    6·2 answers
  • On December 31 of the current year, the unadjusted trial balance of a company using the percent of receivables method to estimat
    10·1 answer
  • a manufacturer makes two types of rubber, butadiene and polyisoprene. the plant has two machines, machine-1 and machine-2, which
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!