User Account

All Pages

What is the lowest price that Laura would be willing accept

Assignment Help Managerial Accounting
Reference no: EM133024800

Question - Laura just received a special order from Jake, a new customer. Jake is offering to purchase 5,000 units from Laura for $16 per unit. Jake requires all 5,000 units to come from the same supplier (i.e., he cannot purchase less than 5,000 units).

The current, normal sales price per unit is $23. Variable costs to produce are $13. Fixed costs per unit are $6.

Laura has capacity of 25,000 units. Before the special order, Laura estimated that she would be able to sell 22,000 units to existing customers.

Via a financial perspective, Laura feels she must decline the offer.

But, she would like to counter Jake's offer with a different selling price.

Required - Assuming a financial perspective, what is the lowest price that Laura would be willing to accept for this 5,000 order from Jake?

Reference no: EM133024800

Questions Cloud

Purchasing strategy in competitive priorities : Do you think that the purchasing strategy in "competitive priorities" dominates the procurement practices of Volkswagen? Use evidence to prove. In addition, dis
Evaluating research findings : What should you consider when evaluating research findings?
Identifying the need for and approach to research : How can you identifying the need for and approach to further research?
Estimate AT weighted-average cost of capital : If AT's stock price is $8 and tax-rate is 30% then estimate AT's weighted-average cost of capital (WACC)
What is the lowest price that Laura would be willing accept : Assuming a financial perspective, what is the lowest price that Laura would be willing to accept for this 5,000 order from Jake
Calculate the accounting rate of return : The project would generate incremental cash flows of $500,000 per year for 9 years. Calculate the Accounting Rate of Return (ARR)
What the appropriate adjustment to recognise the tax effect : If the company tax rate is 30%, what the appropriate adjustment to recognise the tax effect of the business combination revaluation of Land
Calculate the present value of lease payments : The annual rental payments include an amount of $1,200 to cover the cost of maintenance. Calculate the present value of lease payments
How much is the expected free cash flow of the company : The working capital at the end of the last reporting period was $32,000. How much is the expected free cash flow of the company

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