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I need help with the attached file the due date is Tomorow Quiz #2 1. Pederson Enterprises produces giant stuffed bears. Each bear consists of
I need help with the attached file the due date is Tomorow
Quiz #2 1. Pederson Enterprises produces giant stuffed bears. Each bear consists of $12 of variable costs and $9 of fixed costs and sells for $45. A wholesaler offers to buy 8,000 units at $14 each, of which Pederson has the capacity to produce. Pederson will incur extra shipping costs of $1 per bear. Instructions Determine the incremental income or loss that Pederson Enterprises would realize by accepting the special order. Issue: Quantitative Analysis Qualitative Analysis Decision 1 2. Notson, Inc. produces several models of clocks. An outside supplier has offered to produce the commercial clocks for Notson for $420 each. Notson needs 1,200 clocks annually. Notson has provided the following unit costs for its commercial clocks: Direct materials Direct labor Variable overhead Fixed overhead (40% avoidable) $100 140 80 150 Instructions Prepare an incremental analysis which shows the effect of the make-or-buy decision. Issue: Quantitative Analysis Qualitative Analysis Decision 2 3. Harris Timber Corporation uses a machine that removes the bark from cut timber. The machine is unreliable and results in a significant amount of downtime and excessive labor costs. The management is considering replacing the machine with a more efficient one which will minimize downtime and excessive labor costs. Data are presented below for the two machines: Original purchase cost Accumulated depreciation Estimated life Old Machine $340,000 230,000 5 years New Machine $370,000 5 years It is estimated that the new machine will produce annual cost savings of $85,000. The old machine can be sold to a scrap dealer for $8,000. Both machines will have a salvage value of zero if operated for the remainder of their useful lives. Instructions Determine whether the company should purchase the new machine. Issue: Quantitative Analysis Qualitative Analysis Decision 3Step by Step Solution
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