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Than you so so so so much! Andretti Company has a single product called a Dak. The company normally produces and sells 81,000 Daks each
Than you so so so so much!
Andretti Company has a single product called a Dak. The company normally produces and sells 81,000 Daks each year at a selling price of $40 per unit. The company's unit costs at this level of activity are given below Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Variable selling expenses Fixed selling expenses $ 7.50 9.00 3.50 4.00 (S324,000 total) 2.70 6.50 ($526,500 total) Total cost per unit $ 33.20 A number of questions relating to the production and sale of Daks follow. Each question is independent. Required 1-a. Assume that Andretti Company has sufficient capacity to produce 105,300 Daks each year without any increase in fixed manufacturing overhead costs. The company could increase its sales by 30% above the present 81,000 units each year if it were willing to increase the fixed selling expenses by $130,000. Calculate the incremental net operating income. (Round all dollar amounts to 2 decimal places.) Increased sales in units Contribution margin per unit Incremental contribution margin Less added fixed selling expense Incremental net operating income 0.00 1-b. Would the increased fixed selling expenses be justified? Yes 0 2. Assume again that Andretti Company has sufficient capacity to produce 105,300 Daks each year. A customer in a foreign market wants to purchase 24,300 Daks. Import duties on the Daks would be $2.70 per unit, and costs for permits and licenses would be $19,440. The only selling costs that would be associated with the order would be $2.50 per unit shipping cost. Compute the per unit break-even price on this order. (Round your answers to 2 decimal places.) Variable manufacturing cost per unit Import duties per unit Permits and licenses Shipping cost per unit Break-even price per unit 0.00Step by Step Solution
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