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Please answer all Kennywood Inc., a manufacturing firm, is able to produce 1,200 pairs of pants per hour, at maximum efficiency. There are three eight-hour
Please answer all
Kennywood Inc., a manufacturing firm, is able to produce 1,200 pairs of pants per hour, at maximum efficiency. There are three eight-hour shifts each day. Due to unavoidable operating interruptions, production averages 900 units per hour. The plant actually operates only 28 days per month. Based on the current budget, Kennywood estimates that it will be able to sell only 502,000 units due to the entry of a competitor with aggressive marketing capabilities. But the demand is unlikely to be affected in future and will be around 520,000. Assume the month has 30 days. What is the practical capacity for the month? A. 243,000 units B. 864,000 units C. 806,400 units D. 604,800 units Red Rose Manufacturers Inc. is approached by a potential new customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The company has excess capacity. The following per unit data apply for sales to regular customers: Variable costs: Direct materials $130 Direct labor 80 Manufacturing support 155 Marketing costs 85 El Fixed costs: Manufacturing support 175 Marketing costs 95 Total costs 720 Markup (45%) 324 Targeted selling price $1,044 What is the contribution margin per unit? OA. $720 OB. $324 OC. $594 O D. $270 Red Rose Manufacturers Inc. is approached by a potential customer to fulfill a one-time-only special order for a product similar to one offered to domestic customers. The company has excess capacity. The following per unit data apply for sales to regular customers: Variable costs: Direct materials $150 110 Direct labor Manufacturing support 135 Marketing costs 75 Fixed costs: Manufacturing support 185 Marketing costs 55 Total costs 710 Markup (50%) 355 Targeted selling price $1,065 What is the change in operating profits if the one-time-only special order for 1,000 units accepted for $570 a unit by Red Rose? (Assume marketing costs will be incurred for the special order.) OA. $100,000 increase in operating profits OB. $100,000 decrease in operating profits OC. $99,290 increase in operating profits O D. $99,290 decrease in operating profitsStep by Step Solution
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