Question: this is management accounting question please i need the answer ASAP thank you! Clock company Itd produces a component whose annual volume is equal to
Clock company Itd produces a component whose annual volume is equal to 2500 units, sold at 150 each: Raw materials $70000 Direct labor (3 operative workers) $120000 Indirect employee (supervisor/manager) $60000 Machine depreciation $50000 Machine energy consumption $14000 Administrative expenses allocated to the department $22000 TOTAL annual costs: $336000 The general manager is considering two different alternative actions A) an increase of variable costs of 10 % B) an increase of fixed costs of 10 %. Other elements do not change. Determine if alternative a) is more convenient than alternative b)
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