Direct Materials and Direct Labor cost of producing vacuums Factory rent and supervisor salaries Total Costs...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Direct Materials and Direct Labor cost of producing vacuums Factory rent and supervisor salaries Total Costs Total 315,000 150,000 465,000 21,000 Customer A Vacuums produced and sold Price paid for each vacuum by customer. Average Cost per Vacuum Revenue from customer(s) Total Cost of customer(s) Profit from customer(s) Note Assume all vacia that get prodhiced end up getting sold 2 2 $ 20,000 Customer Bi 20 $ 1,000 50 Hint these are fixed and wort change regardless of volume A B C D Using the table move, should we drop Customer A if we cannot terminate the supervisors and also are unable to break our lease for paying rent? Hint: calculate the total profit if 1) we drop A and 2) keep A as a customer. Compare the two Should we drop Customer A if we cannot terminate the supervisors and cannot stop paying factory rent if Customer A only pays $16 per vacuum? Customer B, however, would continue paying $50 even though Customer A would pay $16. Should we drop Customer A if we cannot terminate the supervisors and cannot stop paying factory rent if Customer A only pays $10 per vacuum? Customer B, however, would continue paying $50 even though Customer A would pay $10. Assuming we sell 1,000 vacuums to B at $50 per unit, how many vacuums should we sell to A at $20 in order to earn a profit of $50,000? (hint: can use Goal-seek) 1 1 Direct Materials and Direct Labor cost of producing vacuums Factory rent and supervisor salaries Total Costs Total 315,000 150,000 465,000 21,000 Customer A Vacuums produced and sold Price paid for each vacuum by customer. Average Cost per Vacuum Revenue from customer(s) Total Cost of customer(s) Profit from customer(s) Note Assume all vacia that get prodhiced end up getting sold 2 2 $ 20,000 Customer Bi 20 $ 1,000 50 Hint these are fixed and wort change regardless of volume A B C D Using the table move, should we drop Customer A if we cannot terminate the supervisors and also are unable to break our lease for paying rent? Hint: calculate the total profit if 1) we drop A and 2) keep A as a customer. Compare the two Should we drop Customer A if we cannot terminate the supervisors and cannot stop paying factory rent if Customer A only pays $16 per vacuum? Customer B, however, would continue paying $50 even though Customer A would pay $16. Should we drop Customer A if we cannot terminate the supervisors and cannot stop paying factory rent if Customer A only pays $10 per vacuum? Customer B, however, would continue paying $50 even though Customer A would pay $10. Assuming we sell 1,000 vacuums to B at $50 per unit, how many vacuums should we sell to A at $20 in order to earn a profit of $50,000? (hint: can use Goal-seek) 1 1
Expert Answer:
Answer rating: 100% (QA)
Solution Lets go through this stepbystep A Customer A pays 16 per vacuum Direct materials for A is 1... View the full answer
Related Book For
Fundamental Managerial Accounting Concepts
ISBN: 978-0078110894
6th Edition
Authors: Edmonds, Tsay, olds
Posted Date:
Students also viewed these business writing questions
-
Read the case study "Southwest Airlines," found in Part 2 of your textbook. Review the "Guide to Case Analysis" found on pp. CA1 - CA11 of your textbook. (This guide follows the last case in the...
-
Planning is one of the most important management functions in any business. A front office managers first step in planning should involve determine the departments goals. Planning also includes...
-
Explain the difference between product placement & branded entertainment . Do you personally notice product placements in television shows or movies? Why or why not? Identify at least two factors...
-
Mississippi Products Co. had the following positive cash flows during the current year: received cash from customers of $750,000; received bank loans of $35,000; and received cash from the sale of...
-
If the hospital creates one or more urgent care clinics and adds evening and weekend hours to its primary care clinics, what will happen to emergency department volumes? What effect will that have on...
-
What the methods are for service of a summons and complaint?
-
On August 16, 1997, Parson Corp. purchased 20 acres of land for $500,000. The land has been held for a future plant site until the current date, December 31, 2012. On December 5, 2012, Overland,...
-
On July 1 , 2 0 1 4 , CAP 1 Banking Corp. Issued $ 4 , 0 0 0 , 0 0 0 of 1 0 - year, 8 % bonds at 9 7 . CAP 1 uses the straight - line amortization method to determine interest expense. Interest is...
-
How do the British pay for their National Health Service? What according to the film, might Americans not like about the British system?
-
Braverman Company has two manufacturing departments-Finishing and Fabrication. The predetermined overhead rates in Finishing and Fabrication are $28.00 per direct labor-hour and 120% of direct...
-
Step 1. Access the Healthy People 2030 website at https://health.gov/healthypeopleLinks to an external site.. Step 2. Select Data2030 Search. Step 3. Select Topic Area using the dropdown menu. Choose...
-
You are asked to design the wing of a glider which will perform a steady unpowered flight, as shown in Figure 1 The goal is to maximize the range that it can fly (i.e. R in the figure) for a given...
-
Actus reus usually depends on proof of a voluntary act or an omission. Mens rea is also required for criminal liability. Scenario 1: Alphonso believed that Francine, a work colleague had stolen his...
-
Ren, a sales representative of an Electric Supply Inc made a demo for a new high-speed Auto[1]analyzer for Glen, the owner of a car repair service shop. The price of the Auto-analyzer was $3,500.00....
-
Describe various types of connectors.
-
For the given transfer function: Vo(s) / Vi(s) = (s^2C^2R^2 + 1) / (s^2C^2R^2 + 4sCR + 1) Assumiing that 1/(CR) = 120 PI so write the matlab code to find the magnitude plot
-
Which cost structure has the greater risk? Explain.
-
Allocating indirect cost over varying levels of production On January 1, Glaze Corporation paid the annual royalty of $720,000 for rights to use patented technology to make batteries for laptop...
-
Recording events in T-accounts and preparing financial statements Pruitt Manufacturing Company was started on January 1, 2011, when it acquired $2,000 cash from the issue of common stock. During the...
-
The major reason that the difference and ratio estimation methods would be expected to produce audit efficiency compared to mean estimation is that the a. Number of members of the populations of...
-
Probability proportional to size sampling (PPS) is normally used when it is thought that the population contains a a. Few understatements. b. Large number of understatements. c. Few overstatements....
-
Vale has decided to use PPS sampling in the audit of a client's accounts receivable balances. Vale plans to use the following PPS sampling table: What sample size should Vale use? a. 120 b. 108 c. 60...
Study smarter with the SolutionInn App