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gavmur [86]
3 years ago
15

Cincinnati t-shirts prints custom t-shirts. The cost to produce one shirt is: direct materials, $10; direct labor, $1.20; and ma

nufacturing overhead $4.50. Cincinnati Children’s Hospital asked Cincinnati t-shirt to sell them custom t-shirts for $12 each for a local charity event. Direct material and direct labor are required for each t-shirt. Of the manufacturing overhead, $1.50 is variable and would be incurred on each additional unit. The remaining $3 in overhead is allocated fixed overhead that would not be increased or decreased by this order. What would be the effect on net income if they accept this special order and sell 200 shirts to Cincinnati Children’s Hospital for $12 each?
Business
1 answer:
egoroff_w [7]3 years ago
5 0

Answer:

Effect on income= $140 decrease

Explanation:

Giving the following formula:

Production costs:

Direct material= 10

Direct labor= 1.2

Variable overhead= $1.5

Selling price= $12

Number of units= 200

<u>Because it is a special offer and there is unused capacity, we will not take into account the fixed costs. </u>

Effect on income= Units sold*unitary contribution margin

Effect on income= 200*(12 - 10 - 1.2 - 1.5)

Effect on income= $140 decrease

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Answer:

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Discount rate adjustment: a <em>higher discount rate</em> will encourage investment in the US economy, thus leading to <em>increased reserves</em> as investment inflows increase.

On the other hand, a <em>lower discount rate</em> encourages investment outflow into other jurisdictions with higher yields, <em>thus reducing reserves</em>.

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8 0
3 years ago
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Answer:

True, but it applies to everyone in the organization.

Explanation:

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7 0
3 years ago
An agreement that requires employees to settle disputes with their employer using arbitration instead of a lawsuit is known as
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Answer:

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6 0
2 years ago
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see the other answers in the explanation

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8 0
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3 0
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