The national Hospital Purchasing Authority is negotiating with Clinical Services to reduce its selling price by 20% although a volume of at least 1,200 kits per month has been promised. Should Clinical Services accept this offer? If so, why? If not, what would be your suggestion in order for Clinical Services to maintain its current level of profitability?
Answer to relevant QuestionsWhat is the profitability of Unfocused Books’ three departments and what recommendations would you make to the owners? Within its relevant range, MaxiVent sells its highest volume of 150,000 units at a total cost of £85,000. Selling its lowest volume of 100,000 units incurs total costs of £75,000. Variable costs per unit are: b) £0.20 a. If Maximus Company has excess machine capacity and can add more labour as needed (i.e. neither machine capacity nor labour is a constraint), which product is the most attractive to produce? Provide calculations and ...A call centre department incurs costs of £100,000 per annum which provides the staff to make 25,000 sales calls each year. At the end of the year, management reports disclose that the actual number of calls made is 23,000. ...a. Calculate the total cost of each Product H using: i. Absorption costing using a business-wide overhead recovery rate ii. Absorption costing using departmental overhead rates iii. Activity-based costing b. Explain ...
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