Question
Canyon Trails is studying whether to outsource its Human Resources (H/R) activities. Salaried professionals who earn $390,000 would be terminated; in contrast, administrative assistants who
Canyon Trails is studying whether to outsource its Human Resources (H/R) activities. Salaried professionals who earn $390,000 would be terminated; in contrast, administrative assistants who earn $120,000 would be transferred elsewhere in the organization. Miscellaneous departmental overhead (e.g., supplies, copy charges, overnight delivery) is expected to decrease by $30,000, and $25,000 of corporate overhead, previously allocated to Human Resources, would be allocated to other departments.
If Canyon Trails can secure needed H/R services locally for $410,000, how much would the company benefit by outsourcing?
Lagusta Company incurred the following costs for 50,000 units: Variable costs $180,000 Fixed costs 240,000 Lagusta has received a special order from a foreign company for 5,000 units. There is sufficient capacity to fill the order without jeopardizing regular sales. Filling the order will require spending an additional $8,500 for shipping. If Lagusta wants to earn $9,000 on the order, what should the unit price be?
D'Arien Company incurred the following costs for 70,000 units: Variable costs $420,000 Fixed costs 392,000 D'Arien has received a special order from an Albanian company for 3,000 units. There is sufficient capacity to fill the order without jeopardizing regular sales. Filling the order will require spending an additional $6,600 for shipping. If D'Arien wants to break even on the order, what should the unit sales price be?
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