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The Beauty Print Co (BP Co) prints books, posters and folders. It has recently received a request from a customer to provide a one-off order

The Beauty Print Co (BP Co) prints books, posters and folders. It has recently received a request from a customer to provide a one-off order of books, in excess of normal budgeted production. The order would need to be completed within two weeks. The following cost estimate has already been prepared:

Direct materials:

Paper 15.000m2 at$1,4per m2 21.000

Ink 300.000ml at$0,2per ml 60.000

Direct labour:

Skilled200hours at$36,0per hour 7.200

Semi-skilled800hours at$20,0per hour 16.000

Factory overheads1.000hours at$12,0per hour 12.000

Total production cost 116.200

A quotation now needs to be prepared on a relevant cost basis so that BP Co can offer a price as competitive as possible for the order.

The paper is regularly used by BP Co. There are currently 20.000 m2 in inventory, which cost $ 1,4 per m2. The current purchase price of the paper is $ 1,6 per m2.

  • What price for paper should be included in the quotation?(round to one decimal place)

The ink is regularly used by BP Co and usually costs $ 0,2 per ml.

BP Co already has 600.000 ml in inventory, but 500.000 ml of this is needed to complete other existing orders in the next two weeks.

To import the ink it takes at least five weeks. An alternative national supplier could deliver immediately, but they would charge $0,28 per ml.

  • What is the relevant (total) cost for Ink?(round to zero decimal place)

The skilled labour force is employed under permanent contracts of employment under which they must be paid for 40 hours per week's labour, even if their time is idle due to absence of orders.

Their rate of pay is $ 36 per hour, although any overtime is paid at time and a half.

In the next two weeks, there is spare capacity of 34 labour hours.

  • What fee for skilled labour should be included in the quotation?(round to zero decimal place)

The factory overhead costs are composed of three items: electricity, supervisor's salary and depreciation.

The $ 12 per hour factory overheads costs are composed of:

a) $ 6 per hour reflects the electricity costs of running the printing machine.

b) $ 2 per hour reflects the cost of the factory supervisor's salary. The supervisor is paid an annual salary and is also paid $ 50 per hour for any overtime he works.

c) $ 4 per hour reflects the depreciation of printing machines. The printing machines are regularly used, but there is enough spare capacity to produce the requested books.

  • Determine the relevant cost to be included in the quotation, for the factory overheads.(round to zero decimal place)

Opes de pergunta 22:

SECTION B-2

The Beauty Print Co (BP Co) prints books, posters and folders. It has recently received a request from a customer to provide a one-off order of books, in excess of normal budgeted production. The order would need to be completed within two weeks. The following cost estimate has already been prepared:

Direct materials:$Paper15.000m2 at$1,4per m221.000Ink300.000ml at$0,2per ml60.000Direct labour:Skilled200hours at$36,0per hour7.200Semi-skilled800hours at$20,0per hour16.000Factory overheads1.000hours at$12,0per hour12.000Total production cost116.200

A quotation now needs to be prepared on a relevant cost basis so that BP Co can offer a price as competitive as possible for the order.

USE THE ABOVE DATA TO ANSWER ALL Section B-2 QUESTIONS.

The paper is regularly used by BP Co. There are currently 20.000 m2 in inventory, which cost $ 1,4 per m2. The current purchase price of the paper is $ 1,6 per m2.

  • What price for paper should be included in the quotation?(round to one decimal place)

The ink is regularly used by BP Co and usually costs $ 0,2 per ml.

BP Co already has 600.000 ml in inventory, but 500.000 ml of this is needed to complete other existing orders in the next two weeks.

To import the ink it takes at least five weeks. An alternative national supplier could deliver immediately, but they would charge $0,28 per ml.

  • What is the relevant (total) cost for Ink?(round to zero decimal place)

The skilled labour force is employed under permanent contracts of employment under which they must be paid for 40 hours per week's labour, even if their time is idle due to absence of orders.

Their rate of pay is $ 36 per hour, although any overtime is paid at time and a half.

In the next two weeks, there is spare capacity of 34 labour hours.

  • What fee for skilled labour should be included in the quotation?(round to zero decimal place)

The factory overhead costs are composed of three items: electricity, supervisor's salary and depreciation.

The $ 12 per hour factory overheads costs are composed of:

a) $ 6 per hour reflects the electricity costs of running the printing machine.

b) $ 2 per hour reflects the cost of the factory supervisor's salary. The supervisor is paid an annual salary and is also paid $ 50 per hour for any overtime he works.

c) $ 4 per hour reflects the depreciation of printing machines. The printing machines are regularly used, but there is enough spare capacity to produce the requested books.

  • Determine the relevant cost to be included in the quotation, for the factory overheads.(round to zero decimal place)

BP Co owns a specialized printing machine that could be sold today for $ 300.000 in the used market. If it wins this contract it will need to keep the machine. Once the contract is complete the machine could be sold for $ 240.000. The replacement cost of an equivalent machine today is $ 380.000.

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