Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Accounting Basics Expert

Q1) Rubye Company manufactures a single product, a jar of face cream. Cost of manufacturing and selling a single jar of this product at company's normal activity level of 80,000 jars per month is as follows:

Direct materials............... $37.50
Direct labor.................... $6.00
Variable manufacturing overhead.................... $1.00
Fixed manufacturing overhead...................... $11.50
Variable selling & administrative expense........... $1.80
Fixed selling & administrative expense................. $8.00

Normal selling price of product is $71.10 per unit.

An order has been got from overseas customer for 1,000 jars to be delivered this month at special discounted price. This order would have no effect on company's normal sales and would not change total amount of the company's fixed costs. Variable selling and administrative expense would be $1.50 less per jar on this order than on normal sales.

A. Assume there is ample idle capacity to make the jars of cream needed by overseas customer and special discounted price on special order is $63.70 per jar. By how much would this special order increase (decrease) company's net operating income for the month?    

B. Assume company is already operating at capacity when special order is got from overseas customer. What would be opportunity cost of each unit delivered to overseas customer?            

C. Assume there is not sufficient idle capacity to make all of the units for overseas customer and accepting special order would need cutting back on production of 400 units for regular customers. Minimum acceptable price per unit for the special order is closest to:

Give suitable quantitative accounting analysis to support your answers to three problems A through C.

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M919117

Have any Question? 


Related Questions in Accounting Basics

At its inception the lease term of lease g is 65 of the

At its inception, the lease term of Lease G is 65% of the estimated remaining economic life of the leased property. This lease contains a bargain purchase option. The lessee should record Lease G as a. Neither an asset n ...

Accounting provide referencesresearch the company via the

Accounting Provide References Research the company via the website and download the Income Statement, Statement of Shareholders' Equity, Balance Sheet, and Statement of Cash Flows. Develop a 700-word examination of the f ...

1 proceeds from an issue of debt securities having stock

1) Proceeds from an issue of debt securities having stock warrants should NOT be allocated between debt and equity features when A. the allocation would result in a discount on the debt security B. the warrants issued wi ...

Questionsq1 the largest current asset on waverly

Questions: Q1. The Largest current asset on Waverly Corporation's balance sheet is Short-Term Investments. The investments cost Waverly $8,660, and their market value is $9,000. Suppose Waverly holds the investments in t ...

Accounting principles assignment-q1 smith catering service

Accounting Principles Assignment- Q1. Smith Catering Service completed the following transactions during its first month of operations for July 2016: a. Smith Catering Service commenced operations by receiving $12000 cas ...

1 introductionthis coursework assignment carries 30 of the

1. Introduction This coursework assignment carries 30% of the total of 100% for this Module. It comprises one requirement with one task. It is an individual not a group-based assignment. The task/requirement is detailed ...

Because of recent financial disasters in the news the board

Because of recent financial disasters in the news, the board of directors of your company decided that they wanted to ascertain that the organization's code of ethics was appropriate and in agreement with the Code of Pro ...

1 the rule that requires financial statements to reflect

1. The rule that requires financial statements to reflect the assumption that the business will continue operating instead of being closed or sold, unless evidence shows that it will not continue, is the: Going-concern a ...

1 what are the three classifications of restrictions of

1. What are the three classifications of restrictions of retained earnings, and how are such restrictions normally reported on the financial statements? 2. Indicate how prior period adjustments would be reported on the f ...

Paperprepare an 11- to 15-page paper not including the

Paper Prepare an 11- to 15-page paper (not including the title and reference pages) that assesses a legal/ethical issue or situation relating to a current, previous, or potential future work environment. Use at least 10 ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate