Fillip corporation makes 4000 units of part u13 each year

Reference no: EM13480201

Fillip Corporation makes 4,000 units of part U13 each year. This part is used in one of the company's products. The company's Accounting Department reports the following costs of producing the part at this level of activity: An outside supplier has offered to make and sell the part to the company for $21.60 each. If this offer is accepted, the supervisor's salary and all of the variable costs, including direct labor, can be avoided. The special equipment used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represents fixed costs of the entire company. If the outside supplier's offer were accepted, only $3,000 of these allocated general overhead costs would be avoided. In addition, the space used to produce part U13 would be used to make more of one of the company's other products, generating an additional segment margin of $13,000 per year for that product. What would be the impact on the company's overall net operating income of buying part U13 from the outside supplier?

Reference no: EM13480201

Questions Cloud

Post company began the current month with 10000 in : 1 the 200x records of thompson company showed beginning inventory of 6000 cost of goods sold of 14000 and ending

The purpose of this assignment is for students to : individual assignment part aobjectivethe purpose of this assignment is for students to demonstrate their ability to

Dodrill company makes two products from a common input : dodrill company makes two products from a common input. joint processing costs up to the split-off point total 43200 a

A machine originally had an estimated useful life of 5 : cardco inc. has an annual accounting period which ends on december 31. during the current year a depreciable asset

Fillip corporation makes 4000 units of part u13 each year : fillip corporation makes 4000 units of part u13 each year. this part is used in one of the companys products. the

Given the potential conflict of interest between security : given the potential conflict of interest between security analysts and investment bankers working for the same firm

This essay asks you to choose a 20th or 21st century work : this essay asks you to choose a 20th or 21st century work this could be a work of literature art etc and explain how

Financial statements of ansbro corporation follow cash : financial statements of ansbro corporation follow cash dividends were 14. the company did not dispose of any property

Record the issue of 6000 shares of 6 par value common stock : nbspnbspnbspnbspnbspnbsp nbspnbsprodriguez corporation nbspnbspissues 6000 shares of its common stock for 81800 cash

User Account

All Pages