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4 and 5 please Imperial Jewelers manufactures and sells a gold bracelet for $409.00. The company's accounting system says that the unit product cost for
4 and 5 please
Imperial Jewelers manufactures and sells a gold bracelet for $409.00. The company's accounting system says that the unit product cost for this bracelet is $265.00 as shown below: The members of a wedding party have approached Imperial Jewelers about buying 11 of these gold bracelets for the discounted price of $369.00 each. The members of the wedding party would like special flilgree applied to the bracelets that would increase the direct materials cost per bracelet by $5. Imperial Jewelers would also have to buy a special tool for $469 to apply the fillgree to the bracelets. The special tool would have no other use once the special order is completed To analyze this special order opportunity, Imperlal Jewelers has determined that most of its manufacturing overhead is fixed and unaffected by variations in how much Jewelry is produced in any given period. However, $6.00 of the overhead is variable with respect to the number of brocelets produced. The company also believes that accepting this order would have no effect on its ability to produce and sell Jewelry to other customers. Furthermore, the company could fulfill the wedding party's order using its existing manufacturing capacity. Required: 1. What is the financial advantage (disadvantage) of accepting the special order from the wedding party? 2. Should the company accept the special order? Portsmouth Company makes upholstered furniture. Its only varlable cost is direct materlals. The demand for the company's products far exceeds its manufacturing capacity. The bottleneck (or constraint) in the production process is upholstery labor-hours. Information concerning three of Portsmouth's products appears below: Required: 1. Portsmouth is considering paying its upholstery laborers hourly compensation, in addition to their usual salaries, to work overtime. Assuming that this extra time would be used to produce sofas, up to how much of an overtime rate per hour should the company be willing to pay to keep the upholstery shop open after normal working hours? 2. A small nearby upholstering company has offered to upholster furniture for Portsmouth at a price of $49 per hour. The management of Portsmouth is confident that this upholstering company's work is high quality and their craftsmen can work as quickly as Portsmouth's own craftsmen on the simpler upholstering jobs such as the Love Seat. How much additional contribution margin per hour can Portsmouth earn if it hires the nearby upholstering company to make Love Seats? 3. Should Portsmouth hire the nearby upholstering company? Complete this question by entering your answers in the tabs below. Portsmouth is considering paying its upholstery laborers hourly compensation, in addition to their usual salaries, to work overtime. Assuming that this extra time would be used to produce sofas, up to how much of an overtime rate per hour should the company be willing to pay to keep the upholstery shop open after nommal working hours Step by Step Solution
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