need the attached 5 problems answered

Project Description:

problem 1: make or buy decision

matino manufactures 10,000 telephones per year. the full manufacturing costs per telephone are as follows:

direct materials $ 4
direct labor 16
variable manufacturing overhead 10
average fixed manufacturing overhead 10
total $40

the telecom usa has offered to sell martino 10,000 telephones for $34 per unit. if martino accepts the offer, $20,000 of fixed overhead will be eliminated. applying differential analysis to the situation, should martino make or buy the phones? illustrate your reasoning. what is the savings from your decision?







problem 2: decision involving limited resources

canada production company has 200 labor-hours available. there is no limit on machine-hours. canada can sell all of y it wants, but it can only sell 40 units and 30 units of x and z, respectively.

product x product y product z
contribution margin per unit $30 $15 $24
labor-hours per unit 4 5 4
machine-hours per unit 10 8 2

what is the contribution margin per labor-hour for each product?






problem 3: outsourcing


the wire company manufactures 10,000 rolls of cable each period. the cable is used as an input for producing several other products that wire manufactures. the full manufacturing costs for a batch of 100 rolls of cable are:

direct materials $170
direct labor 100
variable manufacturing overhead 100
average fixed manufacturing overhead 150
total $520

the fixed manufacturing overhead is comprised of depreciation expenses related to prior investments in facilities and equipment that are used in the manufacturing of the cable. these assets have no other use than for the manufacturing of the cable. an outside supplier has offered to sell wire the 10,000 rolls of cable necessary to meet production needs this period for a lump-sum of $40,000. if wire accepts this outside supplier’s offer, how much better or worse off will the company be?





problem 4: joint costs

the kristen company uses a joint process to produce products a, b, c, and d. each product may be sold at its split-off point or processed further. joint processing costs for a single batch of joint products are $60,000. other relevant data are as follows:

product sales value
at split-off additional costs
of processing sales value
of final product
a $15,000 $18,000 $ 40,000
b 27,000 15,000 40,000
c 20,000 25,000 40,000
d 13,000 11,000 25,000
$75,000 $69,000 $145,000

calculate the effect on profits of processing product a further beyond the split-off point.











problem 5: special order

the brown corporation’s management is evaluating a special order from a regular customer. the customer has offered to purchase 6,000 units of a brown corporation product at a price that would provide a contribution margin of $5 per unit. brown’s management wants to accept the offer because so doing would allow them to keep its current work force fully employed. otherwise, brown will lay-off 20 workers home for a week, depriving the workers of their weekly $500 wages. accepting the offer will tie up approximately 1,000 square feet of a building leased at an annual cost of $60 per square foot. at the present time, brown corporation has no alternative use for this portion of the facilities. based on just the information presented above, how much is the brown corporation’s opportunity costs associated with accepting this special order from the customer?
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