Wesco Incorporated's only product is a combination fertilizer/weekdiler called Grow Weed. GrowNeed is sold nationwide to resil nurseries and garden stores. Zwinger Nursery plans to sell a similar fertilizer weedkiller compound through its regional nursery chain under its own private Isbel. Zwinger does not have manufacturing facilities of its own, so has asked Wiesco and several other companies to submit a bid for manufacturing and delivering a 27,000-pound order of the private brand compound to Zwinger While the chemical composition of the Zwinger compound elffers from that of Grow Weed, the manufacturing processes are very similar. The Zwinger compound would be produced in 1000-pound loss. Esch lot would require 34 direct labor-hours and the following chemicals Quantity in Chemicals Pounds 390 AG-5 KL-2 170 280 DF-5 The first three chemicals (AG-5, KL-2, and CW-7are all used in the production of GrowNWeed. DF-6 was used in another compound that Wesco els continued several months ago. The supply of DF-6thst Wesco hed on hand when the other compound was discontinued was not discarded. Wesco could sell its supply of DF-6 at the prevailing market priceles: $0.09 per pound selling and handling expenses Wesco also has on hand a chemical called BH-3, which was manufactured for use in another product that is no longer produced BH-3, which cannot be used in GrowNWeed, can be substitute for AG-5 on a one-for one bass without affecting the quality of the Zwinger compound. The BH 3 in inventory has a salvage value of $440. Inventory and cost osta for the chemicals that can be used to produce the Zwinger compound are shown below: Actual Price Current por Pound Market Raw Pounds in Price per Material Inventory Purchased Pound AG-5 29,800 KL-2 4.100 $ 8.36 $ 0.41 O- Race $ 1.48 DF-5 3.0 EH-3 $2.71 (Salvage) $ 2.46 The current direct Isbor wage rates $16 per hour. The predetermined overhead rate is based on direct labor-hours DLH. The predetermined overhead ste for the current year, based on a two-shit capacity with no overtime, I ss fo Ows variable manufacturing overhead Fixed manufacturing overhead Combined predetermined overhead rate U DLH pr DLH DLH $12.20 Wesco's production manager reports that the present equipment and facilities are deguste to manufacture the Zwinger compound Therefore, the order would have no effect on total fixed manufacturing overhead costs. However, Wesco is within 110 hours of its two- shift capacity this month. Any additional hours beyond the 110 hours must be done in overtime. If need be the Zwinger compound could be produced on regular time by shifting portion of GrowWeed production to overtime. Wesco's direct labor wage rate for overtime is $24 per hour. There is no allowance for any overtime premium in the predetermined overhead rete. Required: 1. Wesco has decided to submits ble for the 27.000 pound order of Zwinger's new compound. The order must be delivered by the end of the current month. Zwinger has indicated that this is a one-time order that will not be repeated. Calculate the lowest price that Wesco could ble for the order and all exactly cover its incremental manufacturing costs. 2 Refer to the original clats. Assume that Zwinger Nursery plans to plsce regular orders for 27,000-pound lots of the new compound Wesco expect the demand for GrowWeed to remain strong. Therefore, the recurring orders from Zwinger would put Wesco over its two-shift capacity. However, production could be scheduled so that 60% of each Zwinger order could be completed during regular hours. As another option, some GrowWeed production could be shifted temporarily to overtime so that the Zwinger orders could be produced on regular time. Current market prices are the best available estimates of future market prices. Wesco's standard markup policy for new products 40% of the full manufacturing cost, including fired manufacturing overhead. Calculate the price that Wesco, Inc., would quote Zwinger Nursery for esch 27.000 pound lot of the new compound, 3suming that to be treated as new product and this pricing policy is followed. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Viesco has decided to submit a bid for the 27,000 pound order of Zwinger's new compound. The order must be delivered by the end of the current month. Zwinger has indicated that this is a one-time order that will not be repeated. Calculate the lowest price that Viesce could bid for the order and still exactly cover its incremental manufacturing costs. (Round all Intermediate calculations and final answer to 2 decimal places.) Lowest price (27.000 pound bid) Wesco Incorporated's only product is a combination fertilizer/weekdiler called Grow Weed. GrowNeed is sold nationwide to resil nurseries and garden stores. Zwinger Nursery plans to sell a similar fertilizer weedkiller compound through its regional nursery chain under its own private Isbel. Zwinger does not have manufacturing facilities of its own, so has asked Wiesco and several other companies to submit a bid for manufacturing and delivering a 27,000-pound order of the private brand compound to Zwinger While the chemical composition of the Zwinger compound elffers from that of Grow Weed, the manufacturing processes are very similar. The Zwinger compound would be produced in 1000-pound loss. Esch lot would require 34 direct labor-hours and the following chemicals Quantity in Chemicals Pounds 390 AG-5 KL-2 170 280 DF-5 The first three chemicals (AG-5, KL-2, and CW-7are all used in the production of GrowNWeed. DF-6 was used in another compound that Wesco els continued several months ago. The supply of DF-6thst Wesco hed on hand when the other compound was discontinued was not discarded. Wesco could sell its supply of DF-6 at the prevailing market priceles: $0.09 per pound selling and handling expenses Wesco also has on hand a chemical called BH-3, which was manufactured for use in another product that is no longer produced BH-3, which cannot be used in GrowNWeed, can be substitute for AG-5 on a one-for one bass without affecting the quality of the Zwinger compound. The BH 3 in inventory has a salvage value of $440. Inventory and cost osta for the chemicals that can be used to produce the Zwinger compound are shown below: Actual Price Current por Pound Market Raw Pounds in Price per Material Inventory Purchased Pound AG-5 29,800 KL-2 4.100 $ 8.36 $ 0.41 O- Race $ 1.48 DF-5 3.0 EH-3 $2.71 (Salvage) $ 2.46 The current direct Isbor wage rates $16 per hour. The predetermined overhead rate is based on direct labor-hours DLH. The predetermined overhead ste for the current year, based on a two-shit capacity with no overtime, I ss fo Ows variable manufacturing overhead Fixed manufacturing overhead Combined predetermined overhead rate U DLH pr DLH DLH $12.20 Wesco's production manager reports that the present equipment and facilities are deguste to manufacture the Zwinger compound Therefore, the order would have no effect on total fixed manufacturing overhead costs. However, Wesco is within 110 hours of its two- shift capacity this month. Any additional hours beyond the 110 hours must be done in overtime. If need be the Zwinger compound could be produced on regular time by shifting portion of GrowWeed production to overtime. Wesco's direct labor wage rate for overtime is $24 per hour. There is no allowance for any overtime premium in the predetermined overhead rete. Required: 1. Wesco has decided to submits ble for the 27.000 pound order of Zwinger's new compound. The order must be delivered by the end of the current month. Zwinger has indicated that this is a one-time order that will not be repeated. Calculate the lowest price that Wesco could ble for the order and all exactly cover its incremental manufacturing costs. 2 Refer to the original clats. Assume that Zwinger Nursery plans to plsce regular orders for 27,000-pound lots of the new compound Wesco expect the demand for GrowWeed to remain strong. Therefore, the recurring orders from Zwinger would put Wesco over its two-shift capacity. However, production could be scheduled so that 60% of each Zwinger order could be completed during regular hours. As another option, some GrowWeed production could be shifted temporarily to overtime so that the Zwinger orders could be produced on regular time. Current market prices are the best available estimates of future market prices. Wesco's standard markup policy for new products 40% of the full manufacturing cost, including fired manufacturing overhead. Calculate the price that Wesco, Inc., would quote Zwinger Nursery for esch 27.000 pound lot of the new compound, 3suming that to be treated as new product and this pricing policy is followed. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Viesco has decided to submit a bid for the 27,000 pound order of Zwinger's new compound. The order must be delivered by the end of the current month. Zwinger has indicated that this is a one-time order that will not be repeated. Calculate the lowest price that Viesce could bid for the order and still exactly cover its incremental manufacturing costs. (Round all Intermediate calculations and final answer to 2 decimal places.) Lowest price (27.000 pound bid)