Answered step by step
Verified Expert Solution
Question
1 Approved Answer
will give thunbs up if right thank you Oakland Precision Products (OPP) manufactures and sells a variety of scales for the kitchen and office. OPP
will give thunbs up if right thank you Oakland Precision Products (OPP) manufactures and sells a variety of scales for the kitchen and office. OPP sells primarily to ictechenware stores, discount stores, and so on. Two of the scales it produces for kitchen use are the Cook and Baker. The Cook is a basic food scale. The Baker, has a greater capacity and special features that facilitate adjusting boking recipes for more or fewer people. The following information is available: The average wage rate is $32 per hour. Variable overhead varies with the quantity of direct lobor-hours. The plant has a capacity of 20.000 direct labor-hours, but current production uses only 17,750 direct labor-hours. A nationwide kitchenware chain has offered to buy 30,000 cook models and 15,000 Baker models if the price is lowered to $10 and $35, respectivety, per unit. A1. If OPP accepts the offer, how many direct labor-hours will be required to produce the additional scales? Complete this question by entering your answers in the tabs below. How much will the profls change if the order is accepted? Assume that the company cannot increase its production capacity to meet the extra demand. Assume that, in the situation presented in requirement b-1, the plant can work overtime. Direct labor costs for the overtime production increase to $45 per hour: Varlable overhead costs for overtime production are $6 per hour more than for normal production. Complete the table below to determine the total contribution margin. Complete this question by entering your answers in the tabs below. How much will the profits change in this situation compared to the capacity constraints scenario in requirement b-1
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started