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HI, how to solve this question please? Zarson's Netballs is a manufacturer of high-quality basketballs and volleyballs. Setup costs are driven by the number of
HI, how to solve this question please?
Zarson's Netballs is a manufacturer of high-quality basketballs and volleyballs. Setup costs are driven by the number of setups. Equipment and maintenance costs increase with the number of machine-hours, and lease rent is paid per square foot. Capacity of the facility is 11,000 square feet, and Zarson is using only 60% of this capacity. Zarson records the cost of unused capacity as a separate line item, not as a product cost. The following is the budgeted information for Zarson. (Click the icon to view the budgeted information.) (Click the icon to view other information.) Requirement 1. Calculate the cost per unit of cost driver for each indirect cost pool. Select the formula you will use, and then calculate the cost driver rate. (Round your answers to the nearest cent. Abbreviations used: "equip." = equipment, "maint." = maintenance.) Requirement 4. Why might excess capacity be beneficial for Zarson? What are some of the issues Zarson should consider before increasing production to use the space? Why might excess capacity be beneficial for Zarson? (Select all that apply.) A. Having excess capacity allows the company to accept special orders if they are received. B. The excess capacity could allow for expanded production of either of the existing models. Requirement 4. Why might excess capacity be beneficial for Zarson? What are some of the issues Zarson should consider before increasing production to use the space? Why might excess capacity be beneficial for Zarson? (Select all that apply.) A. Having excess capacity allows the company to accept special orders if they are received. B. The excess capacity could allow for expanded production of either of the existing models. C. The company could consider adding a new product line. D. The excess capacity is costing Zarson money and, therefore, cannot be beneficial to Zarson. What are some of the issues Zarson should consider before increasing production to use the space? (Select all that apply.) A. The company should consider how much it could take in in rent if it opts to rent out the unused space. B. The company should consider the capital investment needed to start and support a new product line, as well as the demand for a new product. C. The company should consider if there is available labour and machine hours before increasing production to use the space. D. None of the above Budgeted information Other informationStep by Step Solution
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