Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Current Attempt in Progress Oriole Fiber Company is the creator of Y-Go, a technology that weaves silver into its fabrics to kill bacteria and odor

image text in transcribed
image text in transcribed
Current Attempt in Progress Oriole Fiber Company is the creator of Y-Go, a technology that weaves silver into its fabrics to kill bacteria and odor on clothing while managing heat. Y-Go has become very popular in undergarments for sports activities. Operating at capacity, the company can produce 1,079.000 Y-Go undergarments a year. The per unit and the total costs for an individual garment when the company operates at full capacity are as follows. Per Undergarment Total Direct materials $ 2.06 $ 2,222,740 Direct labor 0.43 463,970 Variable manufacturing overhead 1.04 1,122.160 Fixed manufacturing overhead 1.41 1,521,390 Variable selling expenses 0.37 399,230 Totals $5.31 $5,729,490 The US Army has approached Oriole Fiber and expressed an interest in purchasing 249,600 Y-Go undergarments for soldiers in extremely warm climates. The Arnvy would pay the unit cost for direct materials, direct labor, and variable manufacturing overhead costs. In addition, the Army has agreed to pay an additional $ 101 per undergarment to cover all other costs and provide a profit. Presently, Oriole Fiber is operating at 70% capacity and does not have any other potential buyers for Y.Go: If Oriole Fiber accepts the Army's offer, it will not incur any variable selling expenses related to this order extremely warm climates. The Army would pay the unit cost for direct materials, direct Tbor, and variable manufacturing overhead costs. In addition, the Army has agreed to pay an additional $ 1.01 per undergarment to cover all other costs and provide a profit. Presently, Oriole Fiber is operating at 70% capacity and does not have any other potential buyers for Y Go. If Oriole Fiber accepts the Army's offer, it will not incur any variable selling expenses related to this order. Prepare an incremental analysis for the Oriole Fiber. (Enter negative amounts using either a negative sign preceding the number 2.9.-45 or parentheses e.s. (45).) Reject Order Accept Order Net Income Increase (Decrease) Revenues 0 $ Variable costs: Direct materials 0 Direct labor 0 Variable overhead 0 Total variable costs 0 Net income S 0 $

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_2

Step: 3

blur-text-image_3

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

The Birth Of American Accountancy

Authors: Peter L. McMickle, Paul H. Jensen

1st Edition

0367534681, 9780367534684

More Books

Students also viewed these Accounting questions

Question

In what ways are you similar to your closest friends?

Answered: 1 week ago