Harcourt Manufacturing (HM) has the capacity to produce 11,800 fax machines per year. HM currently produces and sells 8,800 units per year. The fax machines normally sell for $280 each. Modem Products has offered to buy 3,800 fax machines from HM for $150 each. Unit-level costs associated with manufacturing the fax machines are $51 each for direct labor and $76 each for direct materials. Product-level and facility-level costs are $68,000 and $83,000, respectively. How much would profit increase (decrease) if HM accepted this special order?

Q: Explain whether both managers are justified in their arguments. How can the Components Division…

A: Transfer price is the price for goods and services, at which these are transferred between different…

Q: Being a finance Manager advice the top management that KPR should manufacture the AQ product…

A: A) The decision whether KPR should manufacture the AQ product internally or they should buy AQ…

Q: what is the incremental effect on the company’s net income?

A:

Q: Magenta Company has a Components Division which currently manufactures 120,000 units of Part AAM but…

A: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the question and…

Q: Company XYZ is currently producing and selling 100 units. At this level, the total direct materials…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: A small shop in Bulacan fabricates portable threshers for palay producers in the locality. The shop…

A: Here in this question, we are required to calculate break even point in unit and make a graphical…

Q: David Company produces two types of gears, Gear A and Gear B, with unit contribution margins of $6…

A: Variable cost means the cost which vary with the level of output and fixed cost means the cost which…

Q: Company XYZ is currently producing and selling 100 units. At this level, the total direct materials…

A: Incremental cost = Incremental units×Variable cost per unit

Q: ing these mechanisms at full capacity are as follows.           Variable costs per unit:…

A: Introduction : Incremental cost means the variable cost which increases with the increase in the…

Q: Company XYZ is currently producing and selling 100 units. At this level, the total direct materials…

A: Total variable cost = direct material + direct labor  + variable MOH + Variable selling costs…

Q: Daffy Duct, Inc., has the capacity to produce 12,000 cases of duct tape per year but only produces…

A: Answer = $5,000 (profit)   Computation of additional Operating Income / (Loss) accepting new offer…

Q: Company XYZ is currently producing and selling 100 units. At this level, the total direct materials…

A: Total variable cost = direct material + direct labor  + variable MOH + Variable selling costs…

Q: The North Pole Company manufactures 2,000 toy trucks per year. The full manufacturing costs per…

A: Fixed cost that cannot be eliminate will form part of cost

Q: Plainfield Company manufactures part G for use in its production cycle. The full cost per unit for…

A: Per unit Total 10000 units   Make Buy Make Buy Direct materials 2     20,000     Direct…

Q: Erika Company makes 70,000 units per year of a part it uses in the products it manufactures. The…

A: Every business organization aims is to earn maximum profit, In the competitive environment is it not…

Q: Abolt Corporation makes 40,000 units per year of a part it uses in the products it manufactures. The…

A: The question is based on the concept of Cost Accounting.

Q: ABC Company has been manufacturing its own products. The company is currently operating at 100% of…

A: In case there are alternatives of making or buying, Then total costs at both the alternatives should…

Q: Dapper Dan produces a man's suit that sells for $200. Although the company's production capacity is…

A: Sales revenue: Multiplying the units sold with the sale price of each unit to get the sales revenue.…

Q: Damon Industries manufactures 30,000 components per year. The manufacturing costs of the components…

A: Marginal costing is an of costing technique and it is the variable cost of one unit of a product…

Q: Widgeon Co. manufactures three products: Bales, Tales, and Wales. Their selling prices are $55, $78,…

A: CVP analysis is considered as a decision-making tool that helps management to make strategies and…

Q: Benitez Company currently outsources a relay switch that is a component in one of its products. The…

A: A make-or-buy decision refers to an act of using cost-benefit to make a strategic choice between…

Q: Ahron Company makes 8,000 units per year of a part it uses in the products it manufactures. The unit…

A: Here we will use the concept of relevant costs. In accounting a cost is considered relevant when it…

Q: Jones Products manufactures and sells to wholesalers approximately 200,000 packages per year of…

A: Special order decisions When deciding the price of products, a company will want to ensure that all…

Q: Han Products manufactures 55,500 units of part S-6 each year for use on its production line. At this…

A: SOLUTION- COMPUTATION OF RELEVANT COST PER UNIT- PARTICULARS AMOUNT DIRECT MATERIAL 6.660…

Q: The Mad Hatter Company owns a machine that manufactures two types of chimney caps. Production time…

A: The calculation of contribution margin for Cap A and Cap B has been made as follows:

Q: Company XYZ is currently producing and selling 100 units. At this level, the total direct materials…

A: Variable costs: These costs are incurred in conjunction to the volume of goods produced or sold. It…

Q: Dapper Dan produces a man's suit that sells for $200. Although the company's production capacity is…

A: Total sales revenue from special order  = Special offer price per unit x Number of units…

Q: The Southern Division of Barstol Company makes and sells a single product, which is a part used in…

A: The lowest acceptable transfer price from the standpoint of the Southern Division should be closest…

Q: Old Camp Company manufactures awnings for its own line of tents. The company is currently operating…

A: Formulas:

Q: Bronco Company owns a machine that can produce two specialized products. Production time for Product…

A: Formula: Contribution margin per production hour = Contribution margin per unit x Units produced per…

Q: Campbell Corporation, which makes and sells 79,400 radios annually, currently purchases the radio…

A: The differential analysis is made by the company to measure the difference in the cost and revenue…

Q: A small shop in Bulacan fabricates portable threshers for palay producers in the locality. The shop…

A: The question is related to Breakeven point sales. The Breakeven point is that level of sales at…

Q: Every year Riverbed Industries manufactures 7,300 units of part 231 for use in its production cycle.…

A: A make or buy decision is the act of choosing between whether to produce in-house or purchase from…

Q: Widgeon Co. manufactures three products: Bales, Tales, and Wales. The selling prices are $55, $78,…

A: Solution:   Particulars Bales Tales Wales Selling Price 55 78 32 Less: Variable Price 20 50…

Q: Sandusky Inc. has the following costs when producing 100,000 units: Variable costs $600,000 Fixed…

A: The cost can be classified into two categories i.e fixed cost and variable cost. The  FIxed cost…

Q: Martin's Company has purchased 20,000 pumps annually from Andres Company. Due to price increasing…

A: Make or buy decision is a part of management accounting in which the total cost of buying the…

Q: Company XYZ is currently producing and selling 100 units. At this level, the total direct materials…

A: Incremental Cost per unit  = Sum of Variable Cost / Units produced  Incremental Cost of additional…

Q: Owly Corporation’s agriculture division currently produces their own soil mix to grow the plants…

A: Cost of Sale is the total cost of units produced & sold. It is the Sum of Prime Cost &…

Q: Dexter Company manufactures part ZX used in several of its engine models. Monthly production costs…

A: Variable cost means the cost which vary with the level of output and fixed cost means the cost which…

Q: Company XYZ is currently producing and selling 100 units. At this level, the total direct materials…

A: Increase in units=102-100=2 units

Q: Han Products manufactures 55,500 units of part S-6 each year for use on its production line. At this…

A: Due to our policy, we can answer only first question. For rest answer , you need to post the…

Q: Windmire Company manufactures and sells to local wholesalers approximately 300,000 units per month…

A: Special orders are those which are irregular in nature and usually contain different terms, selling…

Q: Mervin Company produces circuit boards that sell for $8 per unit. It currently has capacity to…

A: 1.

Q: Colt Company owns a machine that can produce two specialized products. Production time for Product…

A: working note: The Contribution per unit Will be   $8.05   $2.76     Product TLX =…

Q: Han Products manufactures 47,500 units of part S-6 each year for use on its production line. At this…

A: (A)Cost of in-house production saved (variable + fixed) = $30.80 * 47500 = 1463000 (B)Variable cost…

Q: A small shop in Bulacan fabricates portable threshers for palay producers in the locality. The shop…

A: Breakeven points may be used in a lot of different situations. The breakeven point in a property,…

Q: Steve company produces 30000 units of parts each year for use on its production line.  The cost per…

A: Relevant cost of S6 per unit = Direct material cost + direct labor cost + variable manufacturing…

Q: Kobe Company has manufactured 200 partially finished cabinets at a cost of $102,000. These can be…

A: Incremental income = Incremental Sales revenue – Incremental costs

Q: Ahrends Corporation makes 70,000 units per year of a part it uses in the products it manufactures.…

A: Avoidable fixed manufacturing overhead = total fixed manufacturing overhead - applied fixed…