What are some qualitative factors

Assignment Help Cost Accounting
Reference no: EM132863007

Question - World Wide Stereo produces various equipment for home theatre and sound systems. One key component in all of the company's products is a module requiring two speakers configured in custom combinations. The firm currently incurs the following costs to make each speaker module: Direct material 24 Direct labor 16 Variable overhead 10 Fixed overhead 20

Of the per-unit fixed overhead, the firm could avoid $8 if the modules were purchased from a company that has offered to sell an equivalent module for $56. World Wide Stereo produces 20,000 modules annually.

Required -

a. Should World Wide Stereo outsource the production of the module? Show calculations.

b. World Wide Stereo's vice president estimates that the company can rent out the facilities used to make the modules for $120,000 annually. What should the company do? Show calculations.

c. What are some qualitative factors that World Wide Stereo should consider in making the speaker module outsourcing decision?

Reference no: EM132863007

Questions Cloud

Compare and contrast the primary and secondary research : Compare and contrast the primary and secondary research results based on Me´decins sans frontie`res (MSF) / Doctors Without borders , and transform these insigh
Prepare journal entries to record the transactions : Affectionate Company sold merchandise on account for P500,000. Prepare journal entries to record the transactions
Compare red candy and elvis-kresse : Compare Red Candy and Elvis & Kresse, using parameters QSDF&C.
Detect favorable or unfavorable opinions : Sentiment analysis tries to answer the question of what do people feel about a specific topic. For example, in a business setting, sentiment analysis attempts t
What are some qualitative factors : What are some qualitative factors that World Wide Stereo should consider in making the speaker module outsourcing decision
Importance of cross-cultural communication in business : Develop a research proposal for topic "The Importance of Cross-Cultural Communication in Business Negotiations".
Prove or disprove the saying data is the new oil : Explain with original examples the difference between corporate suveillance and law enforcement/intelligence agencies surviellance.
Prepare a partial balance sheet in good form : On the basis of the following data related to current assets for Mission Co. at December 2016, create partial balance sheet in good form
Communicate the information using visual representations : Compare the UK vaccination data in order to identify the difference and similarity in the form of visual displays (such as charts and graphs

Reviews

Write a Review

Cost Accounting Questions & Answers

  What is the target variable cost per unit

What is the target variable cost per unit? Dyggur Traders wishes to earn a 20% return on its $100,000 investment in equipment used to produce

  What would be the unit cost of good units produced on job

Assume that spoilage loss is charged to all production during August. What would be the unit cost of the good units produced on Job 301

  Compute the optimum order sizes for pine and mahogany wood

Compute the optimum order sizes for pine and mahogany wood, separately, in terms of board feet per order. Igor tells you that if he can combine orders for both types of wood.

  Characteristic of the production process

Calculate the unit cost if the rejection is attributable to exacting specifications and calculate the unit cost if the rejection is characteristic of the production process

  Determine the variable cost per order shipped

Determine the variable cost per order shipped, determine the fixed shipping costs per quarter - determine total shipping costs for 20X7 if activity amounts to 570 orders.

  Discuss bicycle insurance and information asymmetry

If bicycle owners do not know whether they are high or low risk consumers, is there an adverse selection problem

  The petty cash fund of the brooks agency is established

Reimbursement of the fund at the end of the current period. 2. Identify the two events that cause a Petty Cash account to be credited in a journal entry.

  Assignment detailsyou are the financial accountant for a

assignment detailsyou are the financial accountant for a mid-sized company and you have been briefed on a meeting that

  Use of absorption costing in a manufacturing

Develop and explain an argument either for or against the use of absorption costing in a manufacturing, service and retail companies?

  Compute the gain or loss on the sale

Compute the gain or loss on the sale and determine if Kinnaird Hospital should purchase the new scanner on January 2, 2012 - Explain why Kinnaird Hospital might be reluctant to purchase the new scanner, regardless of the results indicated by the inc..

  Find comparative income statements for the company

Find comparative income statements for the company similar to Exhibit 6.8 for the three different inventory costing methods of FIFO, LIFO, and weighted average.

  What is way to recording exchanges after all record changes

What is the way to recording exchanges after all record changes are distinguished? The second step in the bookkeeping framework is recorded above as "record."

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd