Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

Need help with missing blanks Double Corporation produces baseball bats for kids that it sells for $37 each. Al capacity, the company can produce 54,000

Need help with missing blanks image text in transcribedimage text in transcribed

Double Corporation produces baseball bats for kids that it sells for $37 each. Al capacity, the company can produce 54,000 bats a year. The costs of producing and selling 54,000 bats are as follows: (Click to view the costs.) Read the requirements. Requirement 1. Suppose Double is currently producing and selling 30,000 bats. At this level of production and sales, its fixed costs are the same as given in the preceding table. Ripken Corporation wants to place a one-time special order for 24,000 bats at S23 each. Double Il incur no variable selling costs for this special order. Should Double accept this one-time special order? Show your calculations. Determine the effect on operating income if the order is accepted. (Enter decreases operating income with parentheses or a minus sign.) Revenues from special order 552000 Variable manufacturing costs 432000 Increase (decrease) in operating income if order is accepted 120.000 Double should Ripken's special order because it increases operating income by 120,000 Requirement 2. Now suppose Double is currently producing and selling 54,000 bals. If Double accepts Ripken's offer it will have to sell 24,000 fewer bals to its regular customers. (a) on financial considerations alone, should Double accept this one-time special order? Show your calculations. (D) On financial considerations alone, at what price would Double be indifferent between accepting the special order and continuing to sell to i regular customers at $37 per bat? (c) What other factors should Double consider in deciding whether to accept the one-time special order? (a) on financial considerations alone, should Double accept this one-time special order? Show your calculations. Determine the effect on operating income if the order is accepted. (Enter decreases in operating income with parentheses or a minus sign.) Revenues from special order 120.000 456,000 Contribution margin foregone 456,000 (336,000) Increase (decrease) in operating income if order is accepted Ripken's special order because it On financial consideration alone, Double should operating income by Data table Cost per Bat Total Costs 12 $ 648,000 5 270,000 54,000 1 Direct materials Variable direct manufacturing labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses 6 324,000 3 162,000 162,000 3 $ 30 $ 1,620,000 Total costs Print Done

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Fundamentals Of Financial Management

Authors: Eugene F. Brigham, Joel F. Houston

Concise 10th Edition

9781337902571

Students also viewed these Accounting questions