Olive Corp currently makes 12,100 subcomponents a year in one of its factories The unit costs to produce are Per unit Direct materials $ 26 Direct labor 26 Variable manufacturing overhead 20 Fixed manufacturing overhead 10 Total unit cost $ 82 An outside supplier has offered to provide Olive Corp with the 12,100 subcomponents at a $88 per unit price Fixed overhead is not avoidable If Olive Corp rejects the outside offer, what will be the effect on short term profits

The Answer is in the image, click to view ...

Question: Olive Corp. currently makes 12,100 subcomponents a year in one of its factories. The unit costs to produce are: Per unit Direct materials $ 26

Olive Corp. currently makes 12,100 subcomponents a year in one of its factories. The unit costs to produce are:

	Per unit
Direct materials		$	26
Direct labor			26
Variable manufacturing overhead			20
Fixed manufacturing overhead			10
Total unit cost		$	82

An outside supplier has offered to provide Olive Corp. with the 12,100 subcomponents at a $88 per unit price. Fixed overhead is not avoidable. If Olive Corp. rejects the outside offer, what will be the effect on short-term profits?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

olive corp currently makes 20,000 sub components a year in one of its factories. the unit costs produced are: Direct materials: $12, Direct labor: 8, Var. manufacturing overhead: 12, fixed manuf....

Cotton Corp.currently makes 13,700 subcomponents a year in one of its factories. The unit costs to produce are: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing...

Help Cotton Corp.currently makes 10,000 subcomponents a year in one of its factories. The unit costs to produce are: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing...

Please answer all Parts of the queastions, Thanks A) B) C) D) E) Cotton Corp.currently makes 11.200 subcomponents a year in one of its factories. The unit costs to produce are: Direct materials...

Olive Corp.currently makes 13,500 subcomponents a year in one of its factories. The unit costs to produce are: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing...

Olive Corp.currently makes 11,300 subcomponents a year in one of its factories. The unit costs to produce are: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing...

PLEASE ANSWER IN EXCEL. QUESTION #4 IN ATTACHMENT Gleeson manufactures a single product with the following full unit costs for 6,000 units: Direct materials $200 Direct labor 120 Variable...

1. Almond has received a special order for 6,000 units of its product at a special price of $90. The product normally sells for $120 and has the following manufacturing costs: Per unit $ Direct...

Stoog Enterprises manufactures ceiling fans that normally sell for $90 each. There are 300 defective fans in inventory, which cost $55 each to manufacture. These defective units can be sold as is for...

i think these are the answers but im not 100% sure. therefore please write an explanantion on what the correct answer is:) 54) Cotton Corp.currently makes 10,000 subcomponents a year in one of its...

State true or false: d d d d dx dx dx dx O True O False

Many data were detected being exported from the PPM Technology Inc, network. An internal investigation has shown an ex-employee still had an active employee account and was discovered exporting...

ntro Consider a portfolio that holds two assets. Which of the following statements are true? Attempt 1 / 3 for 1 0 pts . Part 1 Check all that apply: If both assets are very risky but the correlation...

Q3. Consider the following two functions a b a b 00 01 11 10 00 1 01 00 01 11 10 cd c d 00 1 01 10 1 1 10 a. Find a set of minimum sum of product expressions for f and g. b. Indicate what sharing, if...