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Anand Limited manufactures drones for industrial use. Most of their costs are either true variable costs or fixed costs. However, an account analysis shows the
Anand Limited manufactures drones for industrial use. Most of their costs are either true variable costs or fixed costs. However, an account analysis shows the following items are mixed costs.
Account
Analysis
Total Cost
Production supervision
fixed
$
Utilities
fixed
$
Sales staff wages
fixed
$
Quality control inspections
fixed
$
The variable portion relates to sales commissions based on total sales.
of manufactured units are inspected each year.
In Anand Limited produced and sold drones at $ each.
Required:
Page
Management expects to sell drones in does not anticipate any cost increases due to inflation, and plans to maintain the sales price of $ per drone. Estimate total costs for each of the mixed cost items above. Be sure to show the variable and fixed components of the total cost.
In addition to the facts per requirement assuming that direct material costs are $ per unit and direct labour costs are $ per unit, calculate the expected contribution margin for based on sales of drones.Anand Limited manufactures drones for industrial use. Most of their costs are either true variable costs or fixed costs. However, an account analysis shows the following items are mixed costs.
Account
Analysis
Total Cost
Production supervision
fixed
$
Utilities
fixed
$
Sales staff wages
fixed
$
Quality control inspections
fixed
$
The variable portion relates to sales commissions based on total sales.
of manufactured units are inspected each year.
In Anand Limited produced and sold drones at $ each.
Required:
Page
Management expects to sell drones in does not anticipate any cost increases due to inflation, and plans to maintain the sales price of $ per drone. Estimate total costs for each of the mixed cost items above. Be sure to show the variable and fixed components of the total cost.
In addition to the facts per requirement assuming that direct material costs are $ per unit and direct labour costs are $ per unit, calculate the expected contribution margin for based on sales of drones.
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