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Consider the following information, prepared based on a capacity of 40,000 units:
Category Cost per UnitVariable manufacturing costs $5.00Fixed manufacturing costs $1.50Variable marketing costs $1.00Fixed marketing costs $0.50Capacity cannot be added in the short run and the firm currently sells the product for $10 per unit.Consider each of these scenarios independent of each other.a) The company is currently producing 30,000 units per month. A potential customer has contacted the firm and offered to purchase 10,000 units this month only. The customer is willing to pay $5.50 per unit. Since the potential customer approached the firm, there will be no variable marketing costs incurred. Should the company accept the special order? Why or why not? Be specific.b) Assume the same facts as in part a, except that the company is producing 40,000 units per month. Should the company accept the special order? Why or why not? Be specific.c) List and describe other factors (not those addressed in parts a and b) that should be taken into consideration when deciding whether to accept a special order? Be specific in your responses.Question #3a) What is life-cycle costing? Under what circumstances can it be most useful? What are some potential problems with this approach? Be specific in your responses.b) What is target pricing? Under what circumstances can it be most useful? What are some potential problems with this approach? Be specific in your responses.c) What is cost-plus pricing? Under what circumstances can it be most useful? What are some potential problems with this approach? Be specific in your responses.
Prepare answers to each of the following questions. Assume a tax rate of 30%. (i) Harry Ltd has a balance of prepaid rent in the balance sheet amounting to $100 000 as at 30 Ju
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KIW Ltd currently orders Material B in batches of 2,500 kgs. Material B is consumed at a steady, known rate over the company's planning horizon of one year. The current usage is 40
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Budgeted direct labour cost 75000 hours @ $16 per hour Budgeted manufacturing overhead 80 000 hours @ $17.50 per hour Actual direct labour cost $997 500 Budgeted manufa
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Bedovin Company manufactures office tables and chairs using the job order cost system
WORKED EXAMPLES OF EXPECTED CASH COLLECTIONS PATTERNS
The Smiths have a long-term capital loss carryover of $10,000 from 2010. On May 9, 2007, David's uncle, Joe, gave him the family antique gun collection. Based on family records
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