Han Products manufactures 33,000 units of part S-6 each year for use on its production line....
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Han Products manufactures 33,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead $ 3.70 10.00 2.30 12.00 $ 28.00 Total cost per part An outside supplilier has offered to sell 33,000 units of part S-6 each year to Han Products for $22 per part. If Han Products accepts this offer, the facilities now being used to manufacture part S-6 could be rented to another company at an annual rental of $83,000. However, Han Products has determined that two-thirds of the fixed manufacturing overhead being applied to part S-6 would continue even if part S-6 were purchased from the outside supplier. Required: What is the financial advantage (disadvantage) of accepting the outside supplier's offer? Han Products manufactures 33,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead $ 3.70 10.00 2.30 12.00 $ 28.00 Total cost per part An outside supplilier has offered to sell 33,000 units of part S-6 each year to Han Products for $22 per part. If Han Products accepts this offer, the facilities now being used to manufacture part S-6 could be rented to another company at an annual rental of $83,000. However, Han Products has determined that two-thirds of the fixed manufacturing overhead being applied to part S-6 would continue even if part S-6 were purchased from the outside supplier. Required: What is the financial advantage (disadvantage) of accepting the outside supplier's offer?
Expert Answer:
Answer rating: 100% (QA)
Total cost to purchase 12 X 23 22 X 33000 83000 907000 ... View the full answer
Related Book For
Posted Date:
Students also viewed these accounting questions
-
The cost per unit of producing a product is 60 + 0.2x dollars, where x represents the number of units produced per week. If the equilibrium price determined by a competitive market is $220, how many...
-
The cost per unit in the production of an MP3 player is $60. The manufacturer charges $90 per unit for orders of 100 or less. To encourage large orders, the manufacturer reduces the charge by $0.15...
-
Han Products manufactures 30,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is: Direct materials . . . . . . . . . . . . . ....
-
List the fish and invertebrates you selected after the nitrogen cycling process?
-
A 6 percent convertible bond (maturing in 20 years) is convertible into 25 shares of the companys common stock. The bond has a par value of $1,000 and is currently trading at $800; the stock (which...
-
How does an estimator determine the unit price for an individual bid item on a unit price contract?
-
A viscous fluid flows in a \(0.10-\mathrm{m}\)-diameter pipe such that its velocity measured \(0.012 \mathrm{~m}\) away from the pipe wall is \(0.8 \mathrm{~m} / \mathrm{s}\). If the flow is laminar,...
-
ABC is an electronic manufacturing company based in Singapore. It sells a wide rangeof products to markets in the Asian region. Currently, it has a sizeable IT division withthe following...
-
A currenty situation I'm in is buying new furniture and appliances for my new home, its a constant struggle balancing what I want and how much it costs. A linear way of making this decision is by...
-
Brad?s Building Supplies entered into the following transactions involving current liabilities during 2020 and 2021: Required Prepare journal entries to record these transactions for Brad?s Building...
-
What were some barriers to employing the product of Godrej Security Solutions (GSS)? How can the barrier be overcome? What were the first campaign's specific marketing communication objectives? What...
-
A stone is thrown vertically upward with a speed of 2 8 . 0 m / s .How fast is it moving when it is at a height of 11m?
-
buyer contracted to purchase a vacant lot for $ 3 5 0 , 0 0 0 cash with no contingencies the buyer intends to build a professional office complex on the property. However the buyer did not advise the...
-
The perfect competitor can produce as much as it wants or as little as it wants with no effects on market price whatsoever. True False
-
For firms selling a product that serves universal needs but not facing significant competition, strategy makes sense: A) a localization B) an international C) a transnational D) a global...
-
What was discovered by Wilson & Penzias in 1 9 6 4 at the Bell horn antenna at Holmdel, NJ ?
-
An Act is a statute or law made by: Select one: a. The Minister for Finance b. Both Houses of Parliament c. The local council to which it applies
-
In Problem use geometric formulas to find the unsigned area between the graph of y = f(x) and the x axis over the indicated interval. f(x) = x + 5; [0, 4]
-
Determine whether the graph represents equation (a), (b), or (c). Explain your reasoning. (a) y = 6e-x2/2 (b) y = 6/1 + e-x/2 (c) y = 6(1 - e-x2/2) 6. ++x 4 -4 -2 2. 4.
-
In Exercises 1-4, use a graphing utility to graph the function. Use the zero or root feature to approximate the real zeros of the function. Then determine whether the multiplicity of each zero is...
-
Consider f(x) = (x - 2 and g(x) = 3(x - 2. Why are the domains of f and g different?
-
Determine whether each of the following statements is true or false: Management accountants often work in cross-functional teams throughout the organization.
-
Determine whether each of the following statements is true or false: The internal audit function reports to the audit committee of the board of directors.
-
Determine whether each of the following statements is true or false: Management accountants are now more often looked upon as internal business advisors rather than bean counters recording historical...
Study smarter with the SolutionInn App