Question
Corporation makes two products. Light and Heavy. These two products emerge from a joint process Product Light has been allocated $13,300 of the total joint
Corporation makes two products. Light and Heavy. These two products emerge from a joint process Product Light has been allocated $13,300 of the total joint costs of $34,000. A total of 2,000 units of product Light are produced from the joint process Product grit can be sold at the split-off point for $12 per unit, or it can be processed further for an additional total cost of $10,000 and then sold for $14 per unit (Q) If product Light is processed further and sold, what would be the financial advantage (disadvantage) for compared with sale in its unprocessed form directly after the split-off point? Corporation below: Corporation makes 41,000 units per year of a part it uses in the products it manufactures. The unit product cost of this part is Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Unit product cost An outside supplier has offered to sell to $11.80 22.90 1.50 25.30 $61.50 all of these parts it needs for $47.80 a unit accepts this offer, the facilities now being used to make the part could be used to make more units of another product that is in high demand. The additional contribution margin on this other product would be $246,000 per year. If the part were purchased from the outside supplier, all of the direct labor cost of the part would be avoided. However, $22.40 of the fixed manufacturing overhead cost being applied to the part would continue even if the part were purchased from the outside supplier. This fixed company's remaining products. manufacturing overhead cost would be applied to the (Q) What is the maximum amount that Corporation should be willing to pay an outside supplier per unit for the part if the supplier commits to supplying all 41,000 units required each year? (Round your intermediate calculations to 2 decimal places.)
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