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Please answer all parts if possible. Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,300 remotes
Please answer all parts if possible.
Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,300 remotes is as follows: Cost Direct materials S 66,950 Direct labor $ 56,650 Variable overhead S 30,900 Fixed overhead $ 51,500 Total $ 206,000 Frannie is approached by Lincoln Company, which offers to make the remotes for $18 per unit. Required: 1. Compute the difference in cost per unit between making and buying the remotes if none of the xed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 2. Compute the difference in cost per unit between making and buying the remotes if $20,600 ofthe xed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 3. What is the change in net income ifxed cost of $20,600 can be avoided and Frannie could rent out the factory space no longer in use for $20,600? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the difference in cost per unit between making and buying the remotes if none of the fixed costs can be avoided. What is the change in net incomel if Frannie Fans buys the remotes? Required 2 > 3ray Fullbuster Inc. manufactures Ice Cube Trays. One ofthe managers is considering raising the current price of ice cube :rays $39 per unit by 10%. If this price increase goes through, it is estimated that demand will decrease by 20,000 units per nonth. Gray currently sells 50,200 units per month, each of which costs $24 in variable costs. Fixed costs are $185,000. Qequired: a. What is the current profit? b. What is the current break-even point in units? c. If the manager raises the price, what will profit be? d. If the manager raises the price, what will be the new break-even point in units? e. Assume the manager does not know how much demand will drop if the price increases. By how much would demand have to drop before the manager would not want to implement the price increase? Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Required E What is the current prot? Current Prot I I Required B > \fIf the manager raises the price, what will profit be? Note: Do not round intermediate calculations.Step by Step Solution
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