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please help me out Harold Manufacturing produces denim clothing. This year, it produced 5,130 denim lackets at a manufacturing cost of $42.00 each. These jackets
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Harold Manufacturing produces denim clothing. This year, it produced 5,130 denim lackets at a manufacturing cost of $42.00 each. These jackets were damaged in the warehouse during storage. Management investigated the matter and identified three altematives for these jackets. 1. Jackets can be sold to a secondhand clothing shop for $7.00 each. 2. Jackets can be disassembled at a cost of $32,300 and sold to a recycler for $12.00 each. 3. Jackets can be reworked and turned into good jackets. However, with the damage, management estimates it will be able to assemble the good parts of the 5,130 jackets into only 2,980 jackets. The remaining pleces of fabric will be discarded. The cost of reworking the jackets will be $102,600, but the jackets can then be sold for their regular price of $40.00 each. Required: 1. Caiculate the incremental income. Xia Co. currently buys a component part for $7 per unit. Xia belleves that making the part would require $2.25 per unit of direct materials and $1.15 per unit of direct labor, Xla allocates overhead using a predetermined overhead rate of 205% of direct labor cost. Xia estimates an incremental overhead rate of $0.60 per unit to make the part. 1-a. What are the relevant costs for Xia to make or buy the part? (Round your answers to 2 decimal places.) 1-b. Should Xia make or buy the part? Make Buy Step by Step Solution
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