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Please answer all the questions. Thanks Andretti Company has a single product called a Dak. The company normally produces and sells 89,000 Daks each year
Please answer all the questions. Thanks
Andretti Company has a single product called a Dak. The company normally produces and sells 89,000 Daks each year at a selling price of $42 per unit. The company's unit costs at this level of activity are given below: A number of questions relating to the production and sale of Daks follow. Each question is independent. Required Assume that Andretti Company has sufficient capacity to produce 111, 250 Daks each year without any increase in fixed manufacturing overhead costs. The company could increase its sales by 25% above the present 89,000 units each year if it were willing to increase the fixed selling expenses by $140,000. Calculate the incremental net operating income. (Round all dollar amounts to 2 decimal places.) Would the increased fixed selling expenses be justified? No Yes Assume again that Andretti Company has sufficient capacity to produce 111, 250 Daks each year. A customer in a foreign market wants to purchase 22, 250 Daks. Import duties on the Daks would be $3.70 per unit, and costs for permits and licenses would be $13, 350. The only selling costs that would be associated with the order would be $1.50 per unit shipping cost. Compute the per unit break-even price on this order. (Round your answers to 2 decimal Places.) The company has 800 Daks on hand that have some irregularities and are therefore considered to be ''seconds." Due to the irregularities, it will be impossible to sell these units at the normal price through regular distribution channels. What unit cost figure is relevant for setting a minimum selling price? (Round your answer to 2 decimal places.) Relevant unit __________ per unitStep by Step Solution
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