Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Please answer ALL requirements. P11-34 (final answer) Question Help The Wild Boar Corporation is working at full production capacity producing 10,500 units of a unique
Please answer ALL requirements.
P11-34 (final answer) Question Help The Wild Boar Corporation is working at full production capacity producing 10,500 units of a unique product, Everlast. Manufacturing cost per unit for Everlast is: (Click the icon to view the cost per unit information.) A customer, the Apex Company, has asked Wild Boar to produce 1,500 units of Stronglast, a modification of Everlast. Stronglast would require the same manufacturing processes as Everlast. Apex has offered to pay Wild Boar $42 for a unit of Stronglast plus half of the marketing cost per unit. Read the requirements Requirement 1. What is the opportunity cost to Wild Boar of producing the 1,500 units of Stronglast? (Assume that no overtime is worked.) The opportunity cost is $ Enter any number in the edit fields and then click Check Answer 3 parts remaining Clear All Check Answer - X i Data Table Direct materials 8 Direct manufacturing labor 16 Manufacturing overhead $ 25 Total manufacturing cost Manufacturing overhead cost per unit is based on variable cost per unit of $6 and fixed costs of $105,000 (at full capacity of 10,500 units). Marketing cost per unit, all variable, is $2, and the selling price is $50 Print Done X i Requirements 1. What is the opportunity cost to Wild Boar of producing the 1,500 units of Stronglast? (Assume that no overtime is worked.) 2. The Chesapeake Corporation has offered to produce 1,500 units of Everlast for Wild Boar so that Wild Boar may accept the Apex offer. That is, if Wild Boar accepts the Chesapeake offer, Wild Boar would manufacture 9,000 units of Everlast and 1,500 units of Stronglast and purchase 1,500 units of Everlast from Chesapeake. Chesapeake would charge Wild Boar $39 per unit to manufacture Everlast. On the basis of financial considerations alone, should Wild Boar accept the Chesapeake offer? Show your calculations 3. Suppose Wild Boar had been working at less than full capacity, producing 9,000 units of Everlast, at the time the Apex offer was made. Calculate the minimum price Wild Boar should accept for Stronglast under these conditions. (lgnore the previous $42 selling price.) Print DoneStep 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