Determine the relevant costs for this order, Cost Accounting

Assignment Help:

Make-or buy and relevant costs - The assembly division of Davenport, Inc., is bidding on an order of 50,000 smart phones. The division is eager to get this order because it has a substantial amount of unused plant capacity. The variable cost for each smart phone if $140 in addition to the cost of the display and touchscreen component. The divisional purchasing manager has received two bids for the component. One is from Davenport's electronics division. This bid if for $35 per unit, although its variable cost if only $30 per unit. The other is from an outside vendor for $34 per unit. Davenport's electronics division has sufficient unused capacity for this order.

a) Determine the relevant costs for this order for the assembly division under both internal and outsourcing arrangements.
b) Determine the relevant costs for this order for Davenport as a company under each of the sourcing arrangements.

 


Related Discussions:- Determine the relevant costs for this order

Average cost, Under the average cost method the average cost of goods held ...

Under the average cost method the average cost of goods held in stock is recalculated after each receipt. An issue after the receipts is made at the recalculated average prices. A

Preparation of cash flow statement, To begin with, we require two successiv...

To begin with, we require two successive balance sheets and the operating statement or loss and profit account relating the two balance sheets. There are two ways wherein this s

Participation - behavioural aspects of standards, Participation - Behaviour...

Participation - Behavioural Aspects of Standards It has already been pointed out in the previous paragraph such standard costing systems would be more acceptable whether the e

Occurrence of overhead variances, Occurrence of Overhead Variances Ove...

Occurrence of Overhead Variances Overhead variances arise mainly because of the conventions of the overheads absorption process. The overhead absorption rates employed in this

Difference between expenses and expenditure, The difference among expenses ...

The difference among expenses and expenditure. Expense is the outflow from a profit oriented organization whereas expenditure is the outflow from non-profit organization.

Maginal costing.., fixed expenses are incurred equally in the two half year...

fixed expenses are incurred equally in the two half year periods,calculate

Marginal cost, Role f marginal costing in management information system

Role f marginal costing in management information system

What would be the cost transferred to the blending dept., Walter manufactur...

Walter manufactures a silicone paste wax that goes through three processing departments: cracking, blending, and packing. All raw materials are introduced at the start of work in t

Overhead variances, Overhead Variances This explains how the variable ...

Overhead Variances This explains how the variable overhead total variance and the fixed overhead total variances calculated. You can recall the overheads refer to production c

What would be the impact on net income, Brandywine Homecare, a not-for-prof...

Brandywine Homecare, a not-for-profit business, had revenues of $12 million in 2011. Expenses other than depreciation totaled 75 percent of revenues, and depreciation expense was $

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