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Required information [The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $205 and
Required information [The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $205 and $164, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 127,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha $40 Beta $24 37 30 24 22 32 35 29 25 32 27 194 $163 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Required: 1. What is the total amount of traceable fixed manufacturing overhead for each of the two products? Traceable fixed manufacturing overhead Alpha Beta Required information [The following information applies to the questions displayed below.) Cane Company manufactures two products called Alpha and Beta that sell for $205 and $164, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 127,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct labor Direct materials Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha Beta $40 $24 37 30 24 22 32 35 29 25 32 27 $194 $ 163 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 2. What is the company's total amount of common fixed expenses? Total common fixed expenses 1-Homework 10 Required information The following information applies to the questions displayed below.] Cane Company manufactures two products called Alpha and Beta that sell for $205 and $164, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 127,000 units of each product. Its average cost per unit for each product at this level of activity are given below. Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha Beta $40 $24 37 30 24 22 32 35 29 25 32 27 $194 $163 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 3. Assume that Cane expects to produce and sell 97,000 Alphas during the current year. One of Cane's sales representatives has found a new customer who is willing to buy 27,000 additional Alphas for a price of $148 per unit. What is the financial advantage (disadvantage) of accepting the new customer's order? Required information (The following information applies to the questions displayed below] Cane Company manufactures two products called Alpha and Beta that sell for $205 and $164, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 127,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Alpha Beta $40 $24 37 30 24 22 32 35 29 25 32 27 Total cost per unit $194 $ 163 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 4. Assume that Cane expects to produce and sell 107,000 Betas during the current year. One of Cane's sales representatives has found a new customer who is willing to buy 4,000 additional Betas for a price of $80 per unit. What is the financial advantage (disadvantage) of accepting the new customer's order? Required information [The following information applies to the questions displayed below] Cane Company manufactures two products called Alpha and Beta that sell for $205 and $164, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 127,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Alpha $40 Beta $24 Direct labor 37 30 Variable manufacturing overhead 24 22 Traceable fixed manufacturing overhead 32 35 Variable selling expenses 29 25 Common fixed expenses Total cost per unit 32 27 $194 $163 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 5. Assume that Cane expects to produce and sell 112,000 Alphas during the current year. One of Cane's sales representatives has found a new customer who is willing to buy 27,000 additional Alphas for a price of $148 per unit; however pursuing this opportunity will decrease Alpha sales to regular customers by 12.000 units. a. What is the financial advantage (disadvantage) of accepting the new customer's order? b. Based on your calculations above should the special order be accepted? Complete this question by entering your answers in the tabs below. Req 5A Req 581 What is the financial advantage (disadvantage) of accepting the new customer's order
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