Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Winner's Circle, |nc., manufactures medals for winners of athletic events and other contests. Its manufacturing plant has the capacity to produce 2,400 medals each month.

image text in transcribedimage text in transcribedimage text in transcribed
Winner's Circle, |nc., manufactures medals for winners of athletic events and other contests. Its manufacturing plant has the capacity to produce 2,400 medals each month. Current monthly production is 1,800 medals. The company normally charges $530 per medal. Variable costs and xed costs for the current activity level of 75 percent of capacity are as follows: Production Costs Variable costs: Manufacturing: Direct labor $234,B Direct material 20?,B Marketing 135,B Total variable costs $ 5?6, Fixed costs: Manufacturing $2?, Marketing 135, Total fixed costs $ 342,B Total costs $ 913,B Variable cost per unit $ 329 Fixed cost per unit 199 Average unit cost $ 519 Winners Circle hasjust received a special one-time order for 500 medals at $305 per medal. For this particular order, no variable marketing costs will be incurred. Cathy Donato. a management accountant with Winner's Circle. has been assigned the task of analyzing this order and recommending whether the company should accept or reject it. After examining the costs, Donato suggested to her supervisor, Gerard LePenn. who is the controller, that they request competitive bids from vendors for the raw material as the current quote seems high. LePenn insisted that the prices are in line with other vendors and told her that she was not to discuss her observations with anyone else. Donato later discovered that LePenn is a brother-in-law of the owner of the current raw-material supply vendor. Problem 1456 Part 2 2-3. Compute both the new average unit cost and the incremental unit cost for the special order. 2-b. Should Winner's Circle, Inc; accept the special order? (complete this question hr entering your answers In the tabs below. RquA RquB lmumpulie both the new average unlt east end the incremental unit cost for the special order. {Do not round Intermediate calmlations. Round your answers to 2 decimal places.) New average unit cost - Incremental unit cost - Problem 14-56 Part 2 2-a. Compute both the new average unit cost and the incremental unit cost for the special order. 2-b. Should Winner's Circle, Inc. accept the special order? Complete this queson In! entering your answers In the tabs beluw. Should Winner's Circle, Inc. accept the special order? Should management accept the special order? I l

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Tools for business decision making

Authors: kimmel, weygandt, kieso

4th Edition

978-0470117262, 9780470534786, 470117265, 470534788, 978-0470095461

More Books

Students also viewed these Accounting questions