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Required information PR 14-45 (Stotic) Special Order; Financial and Production Considerations (LO 14-2, 14-4, 14-5) [The following information applies to the questions cisplayed below] Jupiter
Required information PR 14-45 (Stotic) Special Order; Financial and Production Considerations (LO 14-2, 14-4, 14-5) [The following information applies to the questions cisplayed below] Jupiter Corporation manufactures skateboards. Several weeks ago, the firm received a special-order inquiry from Venus, incorporated. Venus desires to market a skateboard similar to one of Jupiter's and has offered to purchase 11,000 units if the order can be completed in three months. The cost dato for Jupiter's model number 43 skateboard follow. Additional data: - The normal selling price of model number 43 is $26.50, however, Venus has offered Jupiter only $1575 becouse of the large quantity it is willing to purchose. - Venus requires a modificotion of the design that will allow a $2.10 reduction in direct-material cost. - Jupher's production supervisor notes that the company will incur $3,700 in additional setup costs and will have to purchase a $2,400 special device to manufacture these units. The device will be discarded once the special order is completed. - Total manufacturing overhead costs are opplied to production at the rate of $20 per machine hour. This figure is based, in part, or budgeted yearly fixed overhead of $750,000 and planned production activity of 60.000 machene hours ( 5,000 per monthi) - Jupiter will allocate $1,800 of existing fixed administrative costs to the order as * part of the cost of doing business" PR 14-45 (Static) Part 2: Calculate the current available machine-hours. 2. As Asume that Jupiter's current production activity consumes 70 percent of planned machine-hour activity. Calculate the current avoilable mochine hours. 2.b. Con the compony accept the order and meet Venus's deadine
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