Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

4. Cobe Company has already manufactured 24,000 units of Product A at a cost of $25 per unit. The 24.000 units can be sold at

image text in transcribed
image text in transcribed
image text in transcribed
4. Cobe Company has already manufactured 24,000 units of Product A at a cost of $25 per unit. The 24.000 units can be sold at this stage for $480,000. Alternatively, the units can be further processed at a $290,000 total additional cost and be converted into 5,800 units of Product B and 11.300 units of Product C. Per unit selling price for Product B is $110 and for Product C is $58. 1. Prepare an analysis that shows whether the 24,000 units of Product A should be processed further or not. 3.33 int Sell as Press Further book Relevant costs Totalnost Income Incremental name or of process The cold 6 A guitar manufacturer is considering eliminating its electric guitar division because its $76,000 expenses are higher than its $72,000 sales. The company reports the following expenses for this division 335 points Unavoidable Expenses Cost of goods sold Direct expenses Indirect expenses Service department costs Avoidable Expenses $ 56,00 9,250 470 6.ee $1,250 1,60e 1,43e chool Should the division be eliminated? Print Electric Guitar Division is: Kept Eliminated References Sales Expenses Total expenses Net Income (loss) Revenues from electric guitar division Avoidable expenses Revenues are greater than than dable experies by 3 Minor Electric has received a special one-time order for 1.200 light fixtures (units) at $10 per unit. Minor currently produces and sells 6.000 units of $11.00 each. This level represents 75% of its capacity Production costs for these units are $12.00 per unit, which includes $8.00 variable cost and $4.00 fod cost. To produce the special order a new machine needs to be purchased at a cost of $600 with a zero salvage value. Management expects no other changes in costs as a result of the additional production. It Minor wishes to earn $1,000 on the special order, the size of the order would need to be Multiple Choice 3.200 units 1600 O 800 O

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting For Dummies

Authors: John A. Tracy

1st Edition

0764550144, 978-0764550140

More Books

Students also viewed these Accounting questions