Pluton makes particular plastics for sale to the public and the government. Basic cost data for a
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Question:
1. Assuming normal production levels, what is the direct materials and direct labor cost per drum?
2. Assuming normal production levels, what is the amount of direct labor and overhead per drum?
3. Assuming normal production levels, what is the full cost per drum?
4. A government agency wants to purchase 200 drums of Xentra at cost plus a flat fee. Which allocation method gives the profit-maximizing result?
5. Assuming Pluton selects the cost allocation method as per pound, how much will profits increase on this order compared with allocating overhead per drum (the current system)?
Related Book For
Smith and Roberson Business Law
ISBN: 978-0538473637
15th Edition
Authors: Richard A. Mann, Barry S. Roberts
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