costing, Managerial Economics

Assignment Help:
Ask quesCase Study

Electron Control, Inc., sells voltage regulators to other manufacturers, who then customize and distribute the products to quality assurance labs for their sensitive test equipment. The yearly volume of output is 15,000 units. The selling price and cost per unit are shown below:

Selling price

$200
Costs:


Direct material
$35

Direct labor
50

Variable overhead
25

Variable selling expenses
25

Fixed selling expenses
15
150
Unit profit before tax

$ 50

Management is evaluating the alternative of performing the necessary customizing to allow Electron Control to sell its output directly to Q/A labs for $275 per unit. Although no added investment is required in productive facilities, additional processing costs are estimated as:

Direct labor
$25 per unit
Variable overhead
$15 per unit
Variable selling expenses
$10 per unit
Fixed selling expenses
$100,000 per yeation..tion #Minimum 100 words accepted#

Related Discussions:- costing

Advantages of planned economy, Advantages of Planned System i)   Uses...

Advantages of Planned System i)   Uses of resources :  Central planning can lead to the full use of all the factors of production, so reducing or ending unemployment. ii

Meaning of inflation, Meaning of Inflation There has been a proliferati...

Meaning of Inflation There has been a proliferation of definitions of inflation. Many of these definitions, however, embody the description of the processes by which the underl

Kinds of bargaining arrangements, Kinds of Bargaining arrangements Bas...

Kinds of Bargaining arrangements Basically there are three kinds of bargaining arrangements, namely: Open Shop: In an open shop a union represents its members, but doe

Increemental principle, asumption and limitation of increemrntal,oppurtunit...

asumption and limitation of increemrntal,oppurtunity cost

State the types of demand elasticity, State the types of demand elasticity ...

State the types of demand elasticity Income Elasticity: Elasticity of demand with respect to change in consumer's income. Price Expectation Elasticity of Demand: Elast

cournot equilibrium, Air Canada and KLM compete for customers on flights a...

Air Canada and KLM compete for customers on flights among Amsterdam and Toronto. The total number of passengers (Q) flown by these two firms is the sum of passengers who fly KLM, Q

Elasticity of demand, a. Explain why the demand for a particular brand is m...

a. Explain why the demand for a particular brand is more elastic than the demand for all cigarettes. If Lucky Strike raised its price by 1% in 1918, was the price elast

Write Your Message!

Captcha
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