Imperial jewelers is considering a special order for 14, Ask an Expert

Accounting

Imperial Jewelers is considering a special order for 14 handcrafted gold bracelets to be given as gifts to members of a wedding party. The normal selling price of a gold bracelet is $405.50 and its unit product cost is $259.00 as shown below:

Direct materials $144.00
Direct labor 83.00
Manufacturing overhead 32.00
Unit product cost $259.00

Most of the manufacturing overhead is fixed and unaffected by variations in how much jewelry is produced in any given period. However, $8 of the overhead is variable with respect to the number of bracelets produced. The customer who is interested in the special bracelet order would like special filigree applied to the bracelets. This filigree would require additional materials costing $7 per bracelet and would also require acquisition of a special tool costing $454 that would have no other use once the special order is completed. This order would have no effect on the company's regular sales and the order could be fulfilled using the company's existing capacity without affecting any other order.

1. What effect would accepting this order have on the company's net operating income if a special price of $365.50 per bracelet is offered for this order?

View complete question

Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9975717

Have any Question?Write your Review or question?

Related Questions in Accounting Basics

Question - segment income statementsnutty co gourmet snacks

Question - Segment Income Statements Nutty Co. Gourmet Snacks has two divisions: Gift Baskets and Packaged Snacks. For first quarter 2018, Gift Baskets had a revenue of $1,125,000 and Packaged Snacks had a revenue of $75 ...

Question - pattys party planners had 1500 of supplies on

Question - Patty's Party Planners had $1,500 of supplies on hand on January 1 2017. During the year, they purchased $30,850 of supplies with cash. On December 31, 2017, they had $4,220 of supplies on hand. Patty's Party ...

Question the availability of funds effects the capital

Question: The availability of funds effects the capital budgeting decisions. The amount of funds available for capital expenditures will be either limited or unlimited. Funds would be considered unlimited when a firm is ...

Question - on january 4 2017 ivanhoe company leased a

Question - On January 4, 2017, Ivanhoe Company leased a building to Vaughn Manufacturing for a ten-year term at an annual rental of $185000. At inception of the lease, Ivanhoe received $740000 covering the first two year ...

Question - melton corporation is preparing the comparative

Question - Melton Corporation is preparing the comparative financial statements for the annual report to its shareholders for fiscal years ended May 31, 2017, and May 31, 2018. The income from operations for the fiscal y ...

Question - at the end of the year but before an adjustment

Question - At the end of the year, but before an adjustment had been made to close Manufacturing Overhead Control, A-1 Frames had the following account balances: Raw Materials Inventory$126,955Work in Process Inventory$1 ...

Accounting question - financial data for joel de paris inc

Accounting Question - Financial data for Joel de Paris, Inc, for last year follows Joel de Paris, Inc Balance Sheet Beginning Balance Ending Balance Assets Cash $125,000 $133,000 Accounts receivable 348,000 483,000 Inv ...

Question as a small business owner in todays

Question: As a small business owner in today's economy: • What three financial reports would you use on a regular basis? • What information would you find on each statement? • What decisions might each statement help you ...

Question - background info company a parent purchased 100

Question - Background info: Company A (parent) purchased 100% of the shares in Company B (subsidiary). Company B sold inventory on the 1/3/17 to Company A for $98,000. This inventory had cost Company B $69,000. by 30/6/1 ...

Question what is the principle of charity in at least a

Question: What is "The Principle of Charity"? In at least a paragraph, discuss a time that someone did not extend the principle of charity to you or that you did not extend the principle of charity to someone else. What ...

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

Recent Questions

Ask Accounting Basics Expert