User Account

All Pages

Exercise I do not understand, Cost Accounting

Assignment Help:
what would your answer be to the following problem, please show detailed calculations:
The XYZ Company manufacturers Part 123 for use in its production line. The manufacturering cost per unit for 20,000 units of Part 123 is as follows:
Direct Material $6, Direct manufacturing labor $30, Variable manufacturing overhead $12, Fixed manufacturing overhead allocated $16; Total manufacturing cost per unit $64.
The ABC Company has offered to sell 20,000 units of Part 123 to XYZ for $60 per unit. XYZ will make a decision to buy the part from ABC if there is an overall savings of at least $25,000 for XYZ. If XYZ accepts ABC''s offer, $9 per unit of the fixed overhead allocated would be eiliminated. Furthermore, XYZ has determined that the released facilities could be used to save relevant costs in the manufacture of Part 987. For XYZ to achieve an overall savings of $25,000, the amount of revelant costs that would have to be saved by using the released facilties in the manufacturer of Part 987 would be (choose one): (1)$140,000; (2)$125,000; (3)$85,000; (4)$80,000?

Thank You
Michael

Related Discussions:- Exercise I do not understand

Applications of marginal costing, what is the concept

what is the concept

Example of methods of allocating service costs, Example of Methods of Alloc...

Example of Methods of Allocating Service Costs Suppose the following data: User department Unit of Service Provided Costs Prior to Service Dep

Prepare cash flow statement, The following details are available from a com...

The following details are available from a company:                                                  2003                 2004                                      2003

Determine the relevant costs, Cowboy Constructions employs a full-time driv...

Cowboy Constructions employs a full-time driver and incurs costs for a vehicle to deliver paperwork between each of their building sites. Select Couriers has offered to carry out t

Cost accounting, raw an organization chart of any actual or hypothetical ma...

raw an organization chart of any actual or hypothetical manufacturing organization to show the position of management/cost accounting department within an organization and discuss

Determine the expected rate of growth of dividends, General Motors has to r...

General Motors has to raise new capital in one of the following three ways. Using the income tax rate of 32%, find the after-tax cost of new capital in each case. (A) Sell commo

the opportunity cost rate is 8 percent, Find the following values for a si...

Find the following values for a single cash flow: a. The future value of $500 invested at 8 percent for 1  year b. The future value of $500 invested at 8 percent for 5 years

OBJECTIVES OF COST ACCOUNTING, OBJECTIVES OF COST ACCOUNTING : 1-DETERMININ...

OBJECTIVES OF COST ACCOUNTING : 1-DETERMINING SELLING PRICE 2-CONTROLING COST 3- PROVIDING INFORMATION FOR DESING MAKING 4-ASCERTAINING COSTING PROFIT 5-Facilitating preparation of

Balance sheet and assuming monthly amortization of patents, Nieland Industr...

Nieland Industries had one patent recorded on its books as of January 1, 2014. This patent had a book value of $288,000 and a remaining useful life of 8 years. During 2014, Nieland

Overhead budgets for 2011., Atkinson's Reliable Tools makes two products th...

Atkinson's Reliable Tools makes two products that use similar raw materials: #587Q and #253X. Estimated production needs for a unit of each product follows. #587Q #253X Steel (in p

Write Your Message!

Captcha
Order Assignment

Featured Services

Order Now

Popular Subjects

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