Unit VI question 13 > >> > >Crane Company manufactured 7,560 units of a component part that is used in its product and incurred the following costs:Direct materials$44,1000068012,600JoVariable manufacturing overheadFixed manufacturing overhead25,200Another company has offered to sell the same component part to the company for S13 per unit. The fixed manufacturing overheadconsists mainly of depreciation on the equipment used to manufacture the part and would not be reduced if the component part waspurchased from the outside firm. If the component part is purchased from the outside firm, Crane Company has the opportunity to usethe factory equipment to produce another product which is estimated to have a contribution margin of $27,720,Prepare an incremental analysis report for Crane Company which can serve as informational input into this make or buy decision.(Enter negative amounts usingeither a negative sign preceding the number eg 45orparentheses eg.(45) Do notleave any feld blank. Enter0for the amounts.)MakeIncrease (Decreas5.e Textbook and MediaSave for LaberAttempts: 0 of 3 usedSubmit Answer

Incremental analysis refers to the analysis which focus on the relevant costs that is related to the…

Answered: Lompany man utaco t materíals $44,100…

Lompany man utaco t materíals $44,100 ct labor 18,900 able manufacturing overhead 12,600 ed manufacturing overhead 25,200 +100 80n

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Overheads

In cost accounting, overhead refers to those expenses which occur during the operating of a business. Overhead includes the fixed, variable, or semi-variable which is not directly involved with a company product or service. It is very important to analyze overhead expense as it helps the company in determining how much a company must charge for its products and services so that they can generate profit. Overhead expenses depend upon the nature of the business operations.

Question

Unit VI question 13

> >> > >
Crane Company manufactured 7,560 units of a component part that is used in its product and incurred the following costs:
Direct materials
$44,100
00680
12,600
Jo
Variable manufacturing overhead
Fixed manufacturing overhead
25,200
Another company has offered to sell the same component part to the company for S13 per unit. The fixed manufacturing overhead
consists mainly of depreciation on the equipment used to manufacture the part and would not be reduced if the component part was
purchased from the outside firm. If the component part is purchased from the outside firm, Crane Company has the opportunity to use
the factory equipment to produce another product which is estimated to have a contribution margin of $27,720,
Prepare an incremental analysis report for Crane Company which can serve as informational input into this make or buy decision.
(Enter negative amounts usingeither a negative sign preceding the number eg 45orparentheses eg.(45) Do notleave any feld blank. Enter0
for the amounts.)
Make
Increase (Decreas
5.
e Textbook and Media
Save for Laber
Attempts: 0 of 3 used
Submit Answer

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