Answered step by step
Verified Expert Solution
Question
1 Approved Answer
M Search results X o) N-able N-cent X M Inbox (15,158) x Course Module X M Question 9 - C x Course Hero X C
M Search results X o) N-able N-cent X M Inbox (15,158) x Course Module X M Question 9 - C x Course Hero X C Skull Company X G (21+(471000/1 X G 6+(432000/10 x + C ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddleware%2... * * Harvesters @ Outlook Web App * Apricot Bulletins 0 Mail - JNelle Park.. Microsoft Office H... * Shared Files Local Investment. Ch 23: Homework Saved Help Save & Exit Submit Check my work 9 Pardo Company produces a single product and has capacity to produce 145,000 units per month. Costs to produce its current monthly sales of 116,000 units follow. The normal selling price of the product is $122 per unit. A new customer offers to purchase 29,000 units for $63.90 per unit. If the special offer is accepted, there will be no additional fixed overhead and no additional fixed general and administrative costs. The special offer would not affect its normal sales. 1.2 points Costs at 116,000 Per Unit Units Direct materials $ 12.50 $ 1, 450, 000 eBook Direct labor 15. 00 1, 740,000 Variable overhead 12 . 00 1, 392, 000 Fixed overhead 17.50 2, 030,000 Hint Fixed general and administrative 14.00 1, 624, 000 Print Totals $ 71.00 $ 8,236,000 References (a) Compute the income from the special offer. (b) Should the company accept the special offer? Complete this question by entering your answers in the tabs below. Required A Required B Compute the income for the special offer. (Round your "Per Unit" answers to 2 decimal places.) SPECIAL OFFER ANALYSIS Per Unit Total Variable costs Contribution margin 0.00 Mc Graw M Search results X ) N-able N-cent x Mi Inbox (15,158) x Course Module x M Question 9 - C X Course Hero X C Skull Company X G (21+(471000/1 X G 6+(432000/10 x + C ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddleware%2... * * Harvesters @ Outlook Web App * Apricot Bulletins 0 Mail - JNelle Park... Microsoft Office H... * Shared Files @ Local Investment.. Ch 23: Homework Saved Help Save & Exit Submit Check my work 9 ULLUUL materials 1 / 4 JU,VVU Direct labor 15 .00 1, 740,000 Variable overhead 12. 00 1, 392,000 Fixed overhead 17.50 2, 030,000 Fixed general and administrative 14.00 1 , 624, 000 Totals $ 71.00 $ 8,236,000 1.2 points (a) Compute the income from the special offer. (b) Should the company accept the special offer? eBook Hint Complete this question by entering your answers in the tabs below. Print References Required A Required B Compute the income for the special offer. (Round your "Per Unit" answers to 2 decimal places.) SPECIAL OFFER ANALYSIS Per Unit Total Variable costs Contribution margin 0.00 Fixed costs Fixed overhead Fixed general and administrative Income $ 0.00 $ Required A Required B > Mc Graw M Search results - kateb x 0) N-able N-central Rem x M Inbox (15,158) - kateb x Course Modules: ACC x M Question 10 - Ch 23: | x Dashboard x 5 Exercise 23-14 (Algo) x + C ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddleware%2... * * Harvesters @ Outlook Web App * Apricot Bulletins Mail - JNelle Park.. Microsoft Office H... * Shared Files Local Investment.. Ch 23: Homework Saved Help Save & Exit Submit Check my work 10 Problem 23-5A (Algo) Special offer pricing LO P7 JART manufactures and sells underwater markers. Its contribution margin income statement follows. 1.2 points Contribution Margin Income Statement For Year Ended December 31 Per Unit Annual Total Sales (600,000 units) $ 7.00 $ 4, 200,000 Variable costs eBook Direct materials 1. 64 984,000 Direct labor 0.56 336,000 Print Variable overhead 0.60 360,000 Contribution margin 4.20 2,520,000 References Fixed costs Fixed overhead 0. 20 120,000 Fixed general and administrative 0. 15 90, 000 Income $ 3.85 $ 2, 310,000 A potential customer offers to buy 70,000 units for $3.60 each. These sales would not affect the company's sales through its normal channels. Details about the special offer follow. Direct materials cost per unit and variable overhead cost per unit would not change. . Direct labor cost per unit would be $0.71 because the offer would require overtime pay. . Accepting the offer would require incremental fixed general and administrative costs of $7,000. . Accepting the offer would require no incremental fixed overhead costs. Required: 1. Compute income from the special offer. 2. Should the company accept or reject the special offer? Complete this question by entering your answers in the tabs below. Mc Graw M Search results - kateb x 0) N-able N-central Rem x M Inbox (15,158) - kateb x Course Modules: ACC x M Question 10 - Ch 23: | x Dashboard x 5 Exercise 23-14 (Algo) x + C ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252FIms.mheducation.com%252Fmghmiddleware%2... * * Harvesters @ Outlook Web App * Apricot Bulletins 0 Mail - JNelle Park... Microsoft Office H... * Shared Files Local Investment.. Ch 23: Homework Saved Help Save & Exit Submit Check my work 10 Required: 1. Compute income from the special offer. 2. Should the company accept or reject the special offer? 1.2 points Complete this question by entering your answers in the tabs below. eBook Required 1 Required 2 Print References Compute income from the special offer. (Round your "Per Unit" answers to 2 decimal places.) Special Offer Analysis Per Unit Total Contribution margin 0.00 Fixed overhead Fixed general and administrative Income (loss) $ 0.00 $ Mc Graw
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started