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Unter Components manufactures low-cost navigation systems for installation in ride-sharing cars. sells these systems to various car services that can customize them for their locale
Unter Components manufactures low-cost navigation systems for installation in ride-sharing cars. sells these systems to various car services that can customize them for their locale and business model It manufactures two systems, the Star100 and the Star150, which differ in terms of capabilities. The following information is available: Costs per Unit Star 100 star160 130 150 Direct materials Direct labor Variable overhead Fixed overhead 4000 510 Total cost per unit Units sold 4,000 2,000 The average wage rate is $40 per hour. Variable overhead varies with the quantity of direct labor-hours. The plant has a capacity of 20,000 direct labor-hours, but current production uses only 10,000 direct labor-hours. Required: a. Anationwide car-sharing service has offered to buy 2,500 Star100 systems and 2,500 Star150 systems if the price is lowered to$400 and $500, respectively, per unit a-1. If Unter accepts the offer, how many direct labor-hours will be required to produce the additional systems? 8.750 a-2. Complete the following table to determine the differential profit increase (or decrease) if Unter accepts this proposal. Prices on regular sales will remain the same Differential revenues: 00 Differential costs 00 Differential profit (loss
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