Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

need some help on the following problems... ZBar Supplies is currently operating below its facility capacity producing 21,000 tape dispensers per month. ZBAR has the

need some help on the following problems...

ZBar Supplies is currently operating below its facility capacity producing 21,000

tape dispensers per month. ZBAR has the capacity to produce up to 25,000

units without incurring any additional fixed costs. The current selling price is $5.00

per dispenser. Management estimates variable costs per unitto be $2.00

Monthly fixed costs grow slightly from year to year but are currently around $35,000

Marathon Distributors, not a normal customer, has approached ZBar to buy 3,500

dispensers next month on a "white label" basis for a per unit price of $4.10

Prepare the incremental analysis that ZBar should use to evaluate this offer.

You may assume that none of ZBAR's current customers are affected.

Per Unit Total Order

1 Incremental Revenues are: ??? ???

2 Direct production costs are: ??? ???

3 Incremental costs not included

in your answer to Q10 are: ??? ???

(may be zero)

4 Opportunity costs are: ??? ???

(may be zero)

5 Net Profits for the special order

are estimated to be: ??? ???

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

Fundamental Financial Accounting Concepts

Authors: Thomas Edmonds

7th Edition

73527122, 978-0073527123

More Books

Students also viewed these Accounting questions

Question

What is the difference between a podcast and a webcast?

Answered: 1 week ago

Question

Does the person have her/his vita posted?

Answered: 1 week ago