Marcy has received a special order for 1,500 units of its product at a special price of $123. The product normally sells for $150 and has the following manufacturing costs: Per unit Direct materials $ 42 Direct labor 23 Variable manufacturing overhead Fixed manufacturing overhead 19 10 Unit cost $ 94 Assume that Marcy has sufficient capacity to fill the order without harming normal production and sales and all fixed overhead is unavoidable. a. If Marcy accepts the order, what effect will the order have on the company's short-term profit? b. What minimum price should Marcy charge to achieve a $30,000 incremental profit? Minimum Price c. Now assume Marcy is currently operating at full capacity and cannot fill the order without harming normal production and sales. If Marcy accepts the order, what effect will the order have on the company's short-term profit?

Q: Sheridan Company incurred the following costs for 54000 units: Variable costs $324000 Fixed costs…

A: Variable cost: These are those cost that changes with the changing level of output, i.e. higher the…

Q: Falcon Co. produces a single product. Its normal selling price is $26 per unit. The variable costs…

A: Special offer does not affect the fixed cost if the special order is under the capacity. So…

Q: Capitol has received a special order for 2,050 units of its product at a special price of $155. The…

A: A special order is any customer request for items or services that a firm does not normally handle.…

Q: Crystal has received a special order for 4,000 units of its product. The product normally sells for…

A: Minimum selling price = incremental revenue/number of units

Q: The Cozy Company manufactures slippers and sells them at $10 a pair. Variable manufacturing cost is…

A: Increase (Decrease) in operating income = Sales on special order - Variable cost incurred on special…

Q: Falcon Co. produces a single product. Its normal selling price is $25 per unit. The variable costs…

A: Incremental analysis:   Incremental analysis refers to the analysis of differential revenue that…

Q: Peach has received a special order for 10,000 units of its product. The product normally sells for…

A: Formulas: Unit price = (Profit + Incremental cost)/ Number of units

Q: Toys R Us Company had the following unit costs: Direct materials $20 Direct labor 10 Variable…

A: Additional profit (loss) = (Special selling price per unit - Relevant cost per unit) x no. of units…

Q: A customer has requested that Lewelling Corporation fill a special order for 3,200 units of product…

A: Incremental revenue=Special order units×Price per unit=3,200×$28=$89,600

Q: Martin Company incurred the following costs for 70,000 units: Variable costs $420,000 Fixed costs…

A: Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Q: Martin Company incurred the following costs for 50,000 units: Variable $180,000 costs Fixed costs…

A: Break-even point (BEP): Breakeven is the point where total expenses are equal to total revenue. at…

Q: The Carlo Company has received a special order for 600 units of product B for P12 a unit. It usually…

A: Profit is defined as the monetary value which is earned by the individual or an organization, when…

Q: manufacturing overhead costs. if the special order is accepted, variable selling costs would…

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

Q: Sage Company is operating at 90% of capacity and is currently purchasing a part used in its…

A: Formula: Differential cost = ( Current purchasing price - Cost excluding fixed cost ) x Units…

Q: 5,000. which normally sells for P35 per unit. Costs associated with the manager has received a…

A:

Q: A company receives a special one-time order for 3,000 units of its product at $15 per unit. The…

A: Given: One time order = 3,000 Order for = $15 Unit selling price = $20 Production cost = $13.50…

Q: Solent Ltd makes a product called the Sandals. The company's directors believe that the product is…

A: The break even point is the point where the company will not have any profits or loss. All the…

Q: Note: This type of decision is similar to dropping a product line.)Birch Company normally produces…

A: Relevant costing is used to make a decision between 2 or more alternative courses of action. In this…

Q: Concord Corporation incurred the following costs for 66000 units: Variable costs $396000 Fixed…

A: Fixed cost does not change with the change in the level of production. So the fixed cost is…

Q: How do i calculate the net income for a special order?   For example: Blowing Sand Company has just…

A: Special orders decisions: Special orders are orders received at special prices and for bulk…

Q: Roger Corp., which has experienced excess production capacity, received a special offer for its…

A: Answer -  Calculation of Profit / Loss when company accept the special offer :     Particulars…

Q: If the special order is excepted what is the impact on the companies overall net operating income?

A: An entity having spare capacity can accept special order at a price that is greater than the…

Q: Clemente Inc. incurs the following costs to produce 10,000 units of a subcomponent: Direct…

A: MAKE OR BUY DECISION INVOLVES WHETHER TO MANUFACTURE A PRODUCT IN - HOUSE OR TO PURCHASE IT FROM A…

Q: Bidbid Company manufactures a product with a unit variable cost of OMR 95 and a unit sales price of…

A: Relevant costing is defined as avoidable costs that are incurred while making a certain business…

Q: what is the impact on the companies overall net operating income?

A: Income or Profits generated through an organisation’s day to day activity is known as operating…

Q: A company receives a special order for 200 units that requires stamping the buyer’s name on each…

A: Given information is: A company receives a special order for 200 units that requires stamping the…

Q: Sage Company is operating at 90% of capacity and is currently purchasir a part used in its…

A: Differential costs is the difference between costs of two alternatives. Costs and revenues should be…

Q: Potter has received a special order for 11,000 units of its product at a special price of $15. The…

A: Here it is given that there is capacity constraint, hence if the company accepts special order then…

Q: Iakisthike, LLC has two lines of products, Regular and Super, and is thinking about discontinuing…

A: Total fixed manufacturing cost = [$140,000 - (7,000 x $18)] + [$375,000 - (3,000 x $109)] = $62,000…

Q: Holly Corp. has received a request for a special order of 9,000 units of product Z74 for $46.50…

A: We should  follow  incremental approach

Q: Vaughn Manufacturing incurs the following costs to produce 10,400 units of a subcomponent: Cost…

A: Solution Production- Direct material  8736 Direct labor 11752 Variable overhead  13104…

Q: Walnut has received a special order for 2,500 units of its product at a special price of $230. The…

A: As the company is already operating at full capacity effect of this decision should be difference in…

Q: Walnut has received a special order for 2,400 units of its product at a special price of $240. The…

A: Answer)   If the company accepts the offer, it will incur variable expenses like Direct Materials…

Q: Helix Company has been approached by a new customer to provide 3,200 units of its regular product at…

A:

Q: Use the information below to answer this question and the next question, Raven Corporation received…

A: Differential cost is the difference between the cost of two alternative decisions, or of a change in…

Q: A company requires two materials ‘M’ and ‘N’ for supplying the goods on a new order. The order…

A: SOLUTION- The relevant cost of material that is not currently held in inventory is its purchase…

Q: Falcon Co. produces a single product. Its normal selling price is $25 per unit. The variable costs…

A: Relevant cost per unit = Total variable cost - variable selling cost = $16 - $2 = $14 per unit

Q: A customer has requested that Lewelling Corporation fill a special order for 2,700 units of product…

A: Given that: Special order units = 2700 units  Price per unit = $33 per unit

Q: Rylan corporation received an offer from an exporter for 25,000 units of product at $16 per unit.…

A: A ) Calculation of profit per unit: Selling price = $ 16 Variable cost = $ 11 Profit = selling price…

Q: Sheffield Corp. incurs the following costs to produce 12800 units of a subcomponent: Direct…

A: Manufacturing Cost: It is also known as the Production Cost or the Product Costs. These are those…

Q: Seville Company manufactures a product with a unit variable cost of $42 and a unit sales price of…

A: Relevant income of the special order is calculated by reducing relevant expenses from the relevant…

Q: John has received a special order for 100 units of its product at a special price of $2,100. The…

A: Special orders are usually one-time and do not attract a fixed cost. So, if the firm has the…

Q: Falcon Co. produces a single product. Its normal selling price is $30 per unit. The variable costs…

A: Impact on net income is the difference between the Incremental revenue and incremental variable…

Q: A company contemplating the acceptance of a special order has the following unit cost behavior,…

A: Fixed cost for special order is irrelevant because fixed cost will not change with the special…

Q: Wehrs Corporation has received a request for a special order of 9,800 units of product K19 for…

A: There are two types of costs incurred in business. One is fixed costs, which do not change with…

Q: A company requires two materials 'M' and 'N' for supplying the goods on a new order. The order…

A: The relevant cost of material that is not currently held in inventory is its purchase cost. If the…

Q: Dewey Manufacturing has been approached by a new customer with an offer to purchase 500 units of its…

A: Given: Special Order Selling Price=$15,000 Special Order Sales Units=500 units

Computerized Accounting System

The Computerized Accounting System is generally a system of maintaining accounts using computers. In this method of accounting system, the accounting transactions are processed through the use of hardware and software to generate the reports such as journals, ledgers, trial balance, trading account, P/L accounts, balance and other reports.