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Hale Company makes sets of wrenches. They are trying to decide whether to continue to make the case the wrenches are sold in, or to outsource it to another company. The direct material and direct labor cost to produce the cases total $2.00 per case. The overhead cost is $1.00 per case which consists of $0.40 in variable overhead which would all be eliminated if the case were bought from the outside supplier. The $0.60 of fixed overhead is based on expected production of 200,000 cases per year and consists of the salary of the case production manager of $40,000 per year and $80,000 in depreciation on equipment that would have no resale value. The manager would be laid off if the cases were bought externally. Additionally, if the case production were stopped, the space that it is using could be rented out for $20,000 per year. The outside supplier has offered to supply the cases for $2.80 per case. How much will Alan save or lose if the cases are bought externally?A Save $0.40 per caseB Lose $0.20 per caseC Lose $0.80 per caseD Save $0.20 per case
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
Cost Accounting Cost accounting has been defined via many accounting scholars in different forums. There is no single watertight definition of cost accounting, however the var
tHE FIRST SECTION ASSIGEMTN ANSWER FOR HAMPSHIR COMPANY DECISIONS
Absorption Costing The process described in this section by that net overheads are absorbed into production naturally enough is identified as absorption costing. The absorpti
initial stock.=21,926,150 purchases.=361,550,000 other expenses=207,000,000 operatig profit=34,500,000 sqles=600,000,000 disc received=23,976,150 final stock=1000,000 variable exp
Mr. Homer Simpson, President and Chief Executive Officer of Duff's Beer Making Supplies Inc. recently hired you as the new budget analyst for his company. As your first duty, he h
Both the parts, Profit and Loss Account and Trading Account of last account are interdependent upon each other. Gross Profit or loss plays a very important role in the calculation
1. The following three one-year "discount" loans are available toyou: Loan A: $120,000 at a 7 percent discount rate Loan B: $110,000 at a 6 percent discount rate Loan
behabioural aspect of standard costing on budget
Lapsol limited manufacture electrical appliances for the export market. The management of the company are considering investing in one of two possible capital expenditure projects.
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