Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please help Colden Enlerpeises manufactures one of the components used to assemble its main company product Specialty Products, inc, has ollered to make the component

please help image text in transcribed
Colden Enlerpeises manufactures one of the components used to assemble its main company product Specialty Products, inc, has ollered to make the component at a cost of $12.30 per uni. Coldon Enterprises' current cost is $16.50 per unit of the component, based on the 120,000 components that Colden Entorpeises currently producos. Read the reouirements Noce of Colden Enterprises' fxed costs will be oliminatod it the component is outsourced However, the freed capacty could be used to buld a new product. This new product would be expected to generate $25,000 of contribution margin per year Requirement 1. If Colden Entemrises cutsources the manulacturing of the component, will operating income increase or decrease? By how much? (Enter a *o" for any tero balances. Use a. minus sign or parentheses in the Diderence column when the cost to make exceeds the cost to buy.) Data table Colden Enlerpeises manufactures one of the components used to assemble its main company product Specialty Products, inc, has ollered to make the component at a cost of $12.30 per uni. Coldon Enterprises' current cost is $16.50 per unit of the component, based on the 120,000 components that Colden Entorpeises currently producos. Read the reouirements Noce of Colden Enterprises' fxed costs will be oliminatod it the component is outsourced However, the freed capacty could be used to buld a new product. This new product would be expected to generate $25,000 of contribution margin per year Requirement 1. If Colden Entemrises cutsources the manulacturing of the component, will operating income increase or decrease? By how much? (Enter a *o" for any tero balances. Use a. minus sign or parentheses in the Diderence column when the cost to make exceeds the cost to buy.) Data table

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

Information Technology Auditing

Authors: James A. Hall

4th edition

1133949886, 978-1305445154, 1305445155, 978-1133949886

More Books

Students also viewed these Accounting questions

Question

Summarize the reactive strategy of your organization.

Answered: 1 week ago