Kilmer Company's customer demand for its only product exceeds its manufacturing capacity. The company provided the followinginformation for the machine whose limited capacity is prohibiting the company from producing and selling additional units:Actual run time this weekMachine time available per weekActual run rate this weekIdeal run rateDefect-free output this weekTotal output this week (including defects)Answer is complete but not entirely correct.70.38 X70.00 *69.77 X32.21 X1-a. Utilization rate1-b. Efficiency rate.1-c. Quality rate1-d. Overall equipment effectiveness2-a. Utilization loss in unitsRequired:1. and 2. With respect to the company's overall equipment effectiveness, calculate the following:Note: Do not round intermediate calculations. Round final answers to 2 decimal places and "Units" answers to the nearest wholenumber.2-b. Efficiency loss in units2-c. Quality loss in units18,550 minutes26,500 minutes4.20 units per minute47,70074,25023,3736 units per minute54,537 units77,910 units

Efficiency loss in units: This is an amount of production lost due to the inefficiencies in the…

Answered: Kilmer Company's customer demand for…

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter20: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 3CMA: Bolger and Co. manufactures large gaskets for the turbine industry. Bolgers per-unit sales price and...

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Bolger and Co. manufactures large gaskets for the turbine industry. Bolgers per-unit sales price and variable costs for the current year are as follows: Bolgers total fixed costs aggregate to 360,000. Bolgers labor agreement is expiring at the end of the year, and management is concerned about the effects of a new labor agreement on its break-even point in units. The controller performed a sensitivity analysis to ascertain the estimated effect of a 10-per-unit direct labor increase and a 10,000 reduction in fixed costs. Based on these data, the break-even point would: a. decrease by 1,000 units. b. decrease by 125 units. c. increase by 375 units. d. increase by 500 units.
A company is considering a special order for 1,000 units to be priced at 8.90 (the normal price would be 11.50). The order would require specialized materials costing 4.00 per unit. Direct labor and variable factory overhead would cost 2.15 per unit. Fixed factory overhead is 1.20 per unit. However, the company has excess capacity, and acceptance of the order would not raise total fixed factory overhead. The warehouse, however, would have to add capacity costing 1,300. Which of the following is relevant to the special order? a. 11.50 b. 1.20 c. 7.35 d. 8.90
Boston Executive. Inc., produces executive limousines and currently manufactures the mini-bar inset at these costs: The company received an offer from Elite Mini-Bars to produce the insets for $2,100 per Unit and supply 1,000 mini-bars for the coming years estimated production. If the company accepts this offer and shuts down production of this part of the business, production workers and supervisors will be reassigned to other areas. Assume that for the short-term decision-making process demonstrated in this problem, the companys total labor costs (direct labor and supervisor salaries) will remain the same if the bar inserts are purchased. The specialized equipment cannot be used and has no market value. However, the space occupied by the mini bar production can be used by a different production group that will lease it for $55,000 per year. Should the company make or buy the mini-bar insert?
Bethany Company has just completed the first month of producing a new product but has not yet shipped any of this product. The product incurred variable manufacturing costs of 5,000,000, fixed manufacturing costs of 2,000,000, variable marketing costs of 1,000,000, and fixed marketing costs of 3,000,000. Under the variable costing concept, the inventory value of the new product would be: a. 5,000,000. b. 6,000,000. c. 8,000,000. d. 11,000,000.
Kilmer Company has demand for its only product that exceeds its manufacturing capacity. The company provided the following information for the machine whose limited capacity is prohibiting the company from producing and selling additional units. Actual run time this week 12,800 minutes Machine time available per week 16,000 minutes Actual run rate this week 6.30 units per minute Ideal run rate 9 units per minute Defect-free output this week 72,576 units Total output this week (including defects) 80,640 units Required: 1. and 2. With respect to the company's overall equipment effectiveness, calculate the following: (Do not round intermediate calculations. Round final answers to 2 decimal places and "Units" answers to the nearest whole number.) 1a. Utilization rate 1b. Efficiency rate 1c. Quality rate 1d. Overall Equipment effectiveness 2a. utilization loss in units 2b. Efficiency loss in units 2c. Quality loss in units
A customer has requested that Lewelling Corporation fill a special order for 2,700 units of product S47 for $33 a unit. While the product would be modified slightly for the special order, product S47's normal unit product cost is $18.40: Direct materials $ 5.10 Direct labor 4.00 Variable manufacturing overhead 2.20 Fixed manufacturing overhead 7.10 Unit product cost $ 18.40 Assume that direct labor is a variable cost. The special order would have no effect on the company's total fixed manufacturing overhead costs. The customer would like modifications made to product S47 that would increase the variable costs by $1.40 per unit and that would require an investment of $17,000.00 in special molds that would have no salvage value. This special order would have no effect on the company's other sales. The company has ample spare capacity for producing the special order. The annual financial advantage (disadvantage) for the company as a result of…
A customer has requested that Lewelling Corporation fill a special order for 3,200 units of product S47 for $28 a unit. While the product would be modified slightly for the special order, product S47's normal unit product cost is $23.50: Direct materials $ 6.80 Direct labor 4.00 Variable manufacturing overhead 3.90 Fixed manufacturing overhead 8.80 Unit product cost $ 23.50 Assume that direct labor is a variable cost. The special order would have no effect on the company's total fixed manufacturing overhead costs. The customer would like modifications made to product S47 that would increase the variable costs by $2.40 per unit and that would require an investment of $12,000.00 in special molds that would have no salvage value. This special order would have no effect on the company's other sales. The company has ample spare capacity for producing the special order. The annual financial advantage (disadvantage) for the company as a result of…
Mooran Corporation has been asked by a customer to fill a special order for 9,000 units of product AB40 for $20.50 a unit. While the product would be modified slightly for the special order, product AB's normal unit product cost is $14.40: Direct materials $ 3.10 Direct labor 1.50 Variable manufacturing overhead 6.40 Fixed manufacturing overhead 3.40 Unit product cost $ 14.40 Assume that direct labor is a variable cost. The special order would have no effect on the company's total fixed manufacturing overhead costs. The customer would like modifications made to product AB45 that would increase the variable costs by $5.00 per unit and that would require an investment of $36,000 in special molds that would have no salvage value. This special order would have no effect on the company's other sales. The company has ample spare capacity for producing the special order. The annual financial…
Below are details of the four products made by Krane Ltd. A B C D Selling price per unit 60 80 100 120 Variable cost per unit 24 36 48 50 Machine time per unit 3 4 6.5 8 Weekly demand for all products is the same. Unfortunately, time available on the machine used to produce all four products is likely to be reduced in the coming week due to maintenance work required. If output of one of the products needs to be restricted and management want to lose as little profit as possible, which of the product line’s outputs should they restrict? Product A Product B Product C Product D
your corporation has received a request for a special order of 6000 units of its product for $16 each. The product unit cost is as follows:(see attached image). The special order would have no effect on the companies total fixed manufacturing overhead cost. If the special order is excepted variable selling cost would decrease by 60%. The special order would have no effect on the companies other sales. The company has ample spare capacity for producing the special order. If the special order is excepted, what is the impact on the companies overall net operating income? a) $13,920 b) $9,600 c) $16,080 d) $20,400
Jackson has received a request for a special order of 9,000 units of product "Michael" for $46.35 each. The normal selling price of this product is $51.26 each, but the units would need to be modified slightly for the customer. The normal unit product cost of product "Michael" is computed as follows: Direct materials $17.24 Dirct labor $6.29 Variable manufacturing overhead $3.78 Fixed manufacturing overhead $6.95 Direct labor is a variable cost. The special order would have no effect on the company's total fixed manufacturing overhead costs. The customer would like some modifications made to product "Michael"that would increase the variable costs by $6.32 per unit and that would require a one-time investment of $46288 in special molds that would have no salvage value. This special order would have no effect on the company's other sales. The company has ample spare capacity for producing the special order.Determine the effect on total net operating income of accepting the special order.…
your corporation has received a special order of 6,000 units of its products for $16 each. the product unit cost is as follows: (see attached image). the special order would have no effect on the company’s total fixed manufacturing overhead costs. if the special order is accepted, variable selling costs would decrease by 40%. This special order would have no effect on the company’s other sales. the company had ample spare capacity for producing the special order. if the special order is accepted, what is the impact on the company’s overall net operating income? a) $9,600 b) $13,920 c) $16,020 d) $20,400

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