User Account

All Pages

What is the highest price per unit

Assignment Help Managerial Accounting
Reference no: EM132632567

Spahr Company produces a part that is used in the manufacture of one of its products. The unit manufacturing costs of this part, assuming a production level of 5,000 units, are as follows:

Direct materials                                        $2.00

Direct labour                                            $4.00

Variable manufacturing overhead                  6.00

Fixed manufacturing overhead                     $1.00

Total cost                                              $13.00

The fixed overhead costs are unavoidable.

Question 1: Erickson Company has offered to sell 5,000 units of the same part to Spahr Company for $11 per unit. Assuming the company has no other use for its facilities, what should Spahr Company do?

a. Make the part and save $1 per unit.

b. Make the part and save $3 per unit.

c. Buy from Erickson and save $1 per unit.

d. Make the part and save $5 per unit.

Question 2:  Assuming no other use for its facilities, what is the highest price per unit that Spahr Company should be willing to pay for the part?

a. $10

b. $8

c. $12

d. $6

Reference no: EM132632567

Questions Cloud

What is the implied price per share of funding round : How many shares must the venture capitalist receive to end up with 20% of the company? What is the implied price per share
Describe responsibilities of the management accountant : Describe each of these responsibilities of the management accountant and identify examples of practices and techniques
What total amount is payable on maturity : If the bill matures in 100 days and interest rates are 4% p.a., what total amount is payable on maturity?
What is the total debt ratio : If the debt equity ratio is .60 and total assets is 160,000 what is the total debt ratio
What is the highest price per unit : Assuming no other use for its facilities, what is the highest price per unit that Spahr Company should be willing to pay for the part?
What would be an ethical concern or potential concern : What would be an ethical concern or potential concern for fraud directly related to the consolidation of financial statements
Quality control of the 3D printed polymer material : Research paper on Using the vibration signal from the tap test for the quality control of the 3D printed polymer material
Explain variables used in linear regression : What are the dependent and independent variables used in linear regression? Can you provide an example?
What the highest price that schmidt should be willing to pay : Company has offered to sell 10,000 units of same part to Schmidt Corporation for $18 per unit. Assuming there is no other use for facilities, Schmidt should?

Reviews

Write a Review

Managerial Accounting Questions & Answers

  Manage budgets and financial plans

Explain the budgeting process and its importance to a business, identifying the components of different budgets, forecast estimates for inclusion in the budgets.

  Prepare a retained earnings statement

Prepare a retained earnings statement for the year and Prepare a stockholders' equity section of given case.

  Prepare a master budget for the three-month period

Prepare a master budget for the three-month period.

  Construct the companys direct labor budget

Construct the company's direct labor budget for the upcoming fiscal year, assuming that the direct labor workforce is adjusted each quarter to match the number of hours required to produce the forecasted number of units produced.

  Evaluate the predetermined overhead rate

Evaluate the Predetermined Overhead Rate

  Determine the company''s bid

Determine the company's bid if activity-based costing is used and the bid is based upon full manufacturing cost plus 30 percent.

  Compute the pool rates for the different activities

Complete the schedule to compute the pool rates for the different activities.

  Prepare Company financial statements

Prepare Company financial statements

  Prepare an analysis of terracycles

This individual assignment is based on the TerraCycle Inc.

  Discuss the ethical issues

Discuss the ethical issues

  Political resources in emerging markets

Calculate the GDP in Income Approach  and Expenditure Approach

  Management accounting - ehsan electronics company

A new plant accountant suggested that the company may be able to assign support costs to products more accurately by using an activity based costing system that relies on a separate rate for each manufacturing activity that causes support costs.

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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