Q1 jones company manufactures widgetsnbsp old ham company

Assignment Help Cost Accounting

Reference no: EM13355519

Q1. Jones Company manufactures widgets. Old Ham Company has approached Jones with a proposal to sell the company one of the components used to make widgets at a price of $100,000 for 50,000 units. Jones is currently making these components in its own factory. The following costs are associated with this part of the process when 50,000 units are produced:

Direct material	$44,000
Direct labor	20,000
Manufacturing overhead	60,000
Total	$124,000

The manufacturing overhead consists of $32,000 of costs that will be eliminated if the components are no longer produced by Jones. The remaining manufacturing overhead will continue whether or not Jones makes the components.

What is the amount of avoidable costs if Jones buys rather than makes the components?

A) $60,000

B) $96,000

C) $124,000

D) $100,000

Q2. The value of benefits foregone by selecting one decision alternative over another is a(n)

A) differential revenue.

B) sunk cost.

C) opportunity cost.

D) incremental benefit.

Reference no: EM13355519

Questions Cloud

Qa company using activity based pricing marks up the direct : qa company using activity based pricing marks up the direct cost of goods by 30 plus charges customers for indirect

Manufacturing overhead is allocated to products based on : manufacturing overhead is allocated to products based on the number of machine hours required. in a year when 20000

The sunrise hotel has 200 rooms each room rents at 110 per : the sunrise hotel has 200 rooms. each room rents at 110 per night and variable costs total 16 per room per night of

Q the sunrise hotel has 200 rooms each room rents at 110 : q the sunrise hotel has 200 rooms. each room rents at 110 per night and variable costs total 16 per room per night of

Q1 jones company manufactures widgetsnbsp old ham company : q1. jones company manufactures widgets.nbsp old ham company has approached jones with a proposal to sell the company

Q1k-henrys dull diner has a contribution margin ratio of 16 : q1.k-henrys dull diner has a contribution margin ratio of 16. if fixed costs are 176800 how many dollars of revenue

Q1conan companys monthly activity level ranged from a low : q1.conan companys monthly activity level ranged from a low of 17000 units in may to a high of 26000 units in october.

Q1 conan companys monthly activity level ranged from a low : q1. conan companys monthly activity level ranged from a low of 17000 units in may to a high of 26000 units in october.

Q1at calebs tights the break-even point is 2000 units if : q1at calebs tights the break-even point is 2000 units. if fixed costs total 300000 and variable costs are 30 per unit

User Account

All Pages