Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Hobart Company produces speakers for PA systems. The speakers are sold to retail music stores for $30. Manufacturing and other costs are as follows: The

image text in transcribed
image text in transcribed
image text in transcribed
Hobart Company produces speakers for PA systems. The speakers are sold to retail music stores for $30. Manufacturing and other costs are as follows: The variable distribution costs are for transportation to the retail music stores. The current production and sales volume is 20,000 per year. Capacity is 25,000 units per year. The speakers are currently unpackaged. Packaging them individually would increase costs by $1.20 per unit. However, the units could then be sold for $33.00. All other information remains the same as the original data. What is the effect on profits if Hobart Company packages the speakers? no change decrease of $24,000 decrease of $36,000 increase of $36,000 Wannabee Company manufactures a product with the following costs per unit at the expected production level of 84,000 units: The company has the capacity to produce 90,000 units. The product regularly sells for $120. A wholesaler has offered to pay $110 a unit for 7,500 units. If the special order is accepted, the effect on operating income would be a $249,000 increase. $429,000 increase. $495,000 increase. $75,000 decrease. Concierge Industries manufactures 40,000 components per year. The manufacturing cost of the components was determined as follows: An outside supplier has offered to sell the component for $12.75. What is the effect on income if Concierge Industries purchases the component from the outside supplier? $30,000 increase $30,000 decrease $270,000 increase $270,000 decrease

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

Step: 3

blur-text-image

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

Auditing And Assurance Services

Authors: William Messier, Steven Glover, Douglas Prawitt

8th Edition

ISBN: 0078025435, 9780078025433

More Books

Students also viewed these Accounting questions

Question

What should Gail do now?

Answered: 1 week ago