Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Rainbow Ltd has been offered a contract that will last six months. The contract will use two employees who are currently on zero-hours contracts paid

Rainbow Ltd has been offered a contract that will last six months. The contract will use two employees who are currently on zero-hours contracts paid 26 per hour each. The hours to be spent on the contract will be 1722 hours. The price of the contract is 150,000. The rent on a building used for the contract costs 83178 per year, and the space allocated to the contract is 29% of the total floor area; the rental contract is not affected by the acceptance or rejection of the contract. Other costs for the contract include depreciation of 21506 on a machine. If the machine is not used on the contract it will be scrapped as it has no other use. Using relevant costing techniques, what is the benefit to Rainbow Ltd of accepting the contract

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_2

Step: 3

blur-text-image_3

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

Frank Woods Business Accounting

Authors: Frank Wood, Alan Sangster

9th Edition

0273655523, 9780273655527

More Books

Students also viewed these Accounting questions

Question

x-3+1, x23 Let f(x) = -*+3, * Answered: 1 week ago

Answered: 1 week ago