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Question 43 of 43 - / 24 = Wildhorse Bikes could sell its bicycles to retailers either assembled or unassembled. The cost of an unassembled
Question 43 of 43 - / 24 = Wildhorse Bikes could sell its bicycles to retailers either assembled or unassembled. The cost of an unassembled bike is as follows. Direct materials $183 Direct labor 80 Variable overhead (70% of direct labor) 56 Fixed overhead (30% of direct labor) 24 Manufacturing cost per unit $343 The unassembled bikes are sold to retailers at $521 each. Wildhorse has unused productive capacity that is expected to continue indefinitely; management has concluded that some of this capacity could be used to assemble the bikes and sell them at $563 each. Assembling the bikes will increase direct materials by $5 per bike and direct labor by $10 per bike. Additional variable overhead will be incurred at the normal rates, but there will be no additional fixed overhead as a result of assembling the bikes. Prepare an incremental analysis for the sell-or-process-further decision. (Enter negative amounts using either a negative sign preceding the number e.g.-45 or parentheses eg. (45). Do not leave any field blank. Enter for the amounts.) Process Further Net Income Increase (Decrease) Sell Question 43 of 43 -/24 III Prepare an incremental analysis for the sell-or-process-further decision. (Enter negative amounts using either a negative sign preceding the number eg.-45 or parentheses e.g. (45). Do not leave any field blank. Enter Ofor the amounts.) Process Further Net Income Increase (Decrease) Sell $ $ $ $
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