Unter Components manufactures low-cost navigation systems for installation in ride-sharing cars. It 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:
Unter Components manufactures low-cost navigation systoms for installaton in ridc-sharing cars t sels those systems to various car servicos that can customizo them for their localo and business model It manufacturos two systems, the Star100 and the Star150, which diffor in torms of Costs per Unt Dirodt mater als Diroot labor Star100 Star150 72 82 50 25 122 40 20 $ 229 4,000 Fbxed cvormoad 284 Total coat per unit Price Unts soi 2.000 The average wage rate is $25 per hour. Variable overheed varies with the quantty cf direct lebor-hcurs. The plant has a capacity of 20,000 direct labor-hours, but current production uses ony 10.400 direct labor-hours Required: a. A nationwide car-sharing service has cffered to buy 2,600 3tar100 systems and 2,600 Star150 syslems if the price is lowered to $210 and 5260, respectively. per unit 8-1. if Umer accepts the omer, how many direct labor-hours will be requred produce the additional systems? 9,360 a-2. Complete the following table to determine the differential profit increase (or decrease) if Unter accepts this proposal Prices on regular sales wil remain the same Differental revenues Star 100 Star 150 676,0001 $1,222C00 Ditterental coss Star 100 Star 150 408 200 751,400 Diffarantial profe (loss) b-1, Supposed that the car-sharing service hes cfTered instead to buy 3.600 each of the two models at $210 and 5260, respectively. This customer will purchase the 3,600 units of each model only in an al-or-nothing deal. That is, Unter must provide all 3,600 unts cf each mcdel or none mers e egement hes decided to fil the entire special o er or both mo ts. In wie ofts capacity cons raints. Ute wil educe sales to egular customers aneeded to fil the special der on olete the table below to deer mine the total oont but n mer n wit the special o er a de Special Order 103 Contrbution margin per unit Number ofunits Total contribution margin 475, 5 370 5 846cCO Regular production Contrbution margin per unit Number ofunits Total contribution margin Total contribution margin for both: 846.000 b-2. How much wll the profits change the order accepted? Assume that the Dompany cannot nar ase its prcoucton oapaaty to moat the Odra demand
