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34kurt
3 years ago
12

Admirable Inc. makes three products in a single facility. Data concerning these products follow: Product A B C Selling price per

unit $72.70 $77.10 $76.10 Direct materials $33.10 $40.60 $46.40 Direct labor $22.00 $13.10 $7.20 Variable manufacturing overhead $4.60 $4.40 $3.30 Variable selling cost per unit $1.60 $3.20 $2.00 Mixing minutes per unit 2.8 1.9 2.6 Monthly demand in units 3,000 1,300 2,200 The mixing machines are potentially the constraint in the production facility. A total of 14,800 minutes are available per month on these machines. Direct labor is a variable cost in this company. How much of each product should be produced to maximize net operating income
Business
1 answer:
Fiesta28 [93]3 years ago
3 0

Answer:

Product A $3.43

Product B $8.32

Product C $6.62

Explanation:

Calculation to determine How much of each product should be produced to maximize net operating income

Product A Product B Product C

Selling price per unit $72.70 $77.10 $76.10

Direct materials $33.10 $40.60 $46.40

Direct labor $22.00 $13.10 $7.20

Variable manufacturing overhead $4.60 $4.40 $3.30

Variable selling cost per unit $1.60 $3.20 $2.00

Total variable cost per unit $61.3 $61.3 $58.9

Contribution margin per unit $9.6 $15.8 $17.2

Product A ($72.70-$61.3=$9.6)

Product B ($77.10-$61.3=$15.8)

Product C ($76.10-$58.9=$17.2)

Mixing minutes per unit 2.8 1.9 2.6

Contribution margin per unit $3.43 $8.32 $6.62

Rank in terms of profitability 3 1 2

Product A ($9.6/2.8=$3.43)

Product B ($15.8/1.9=$8.32)

Product C ($17.2/2.6=$6.62)

Therefore How much of each product should be produced to maximize net operating income will be:

Product A $3.43

Product B $8.32

Product C $6.62

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Answer:

Use formula: (((F1^F2) - (F1*F2)) / ((F2-F1) + (F1*F2))) /  % of hours

Explanation:

4 0
3 years ago
Thornton Industries began construction of a warehouse on July 1, 2018. The project was completed on March 31, 2019. No new loans
Nina [5.8K]

Answer:

interest capitalized during 2018 = $29,000

interest capitalized during 2019 = $14,000

Explanation:

current outstanding liabilities:

$6,000,000, 8% note

$9,000,000, 3% bonds

construction related expenditures:

July 1, 2018 $580,000

September 30, 2018 $870,000

November 30, 2018 $870,000

January 30, 2019 $810,000

interest capitalized for 2018:

July 1, 2018 $580,000 x 6/12 = $290,000

September 30, 2018 $870,000 x 3/12 = $217,500

November 30, 2018 $870,000 x 1/12 = $72,500

total weighted accumulated expenditures = $580,000

weighted interest rate:

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total weighted interest = 5%

interest capitalized during 2018 = $580,000 x 5% = $29,000

interest capitalized for 2018:

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6 0
3 years ago
Which of the following is an example of traditional management?
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3 years ago
Invertebrates have a (an) ____ which provides a support framework.
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8 0
3 years ago
Windhoek Mines, Ltd., of Namibia, is contemplating the purchase of equipment to exploit a mineral deposit on land to which the c
grin007 [14]

Answer:

Windhoek Mines, Ltd.

The net present value of the proposed mining project is:

=  ($232,950).

Explanation:

a) Data and Calculations:

Cost of new equipment and timbers = $500,000

Working capital required  = $100,000

Annual net cash receipts = $120,000

Cost to construct new roads in three years = $40,000

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Cost of new equipment and timbers  $500,000      1               -$500,000

Working capital required                        100,000       1                 -100,000

Annual net cash receipts                       120,000     2.589            310,680

Cost to construct new roads in 3 years 40,000     0.579             -23,160

Salvage value of equipment in 4 years 65,000     0.482               31,330

Working capital released in 4 years     100,000     0.482              48,200

Net present value                                                                      ($232,950)

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3 years ago
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