Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Cost Accounting Expert

problem: Relevant costs, special sales order-idle versus full capacity Hull Motors, Inc. [HMI], create small gasoline-powered motors for use in lawn mowers. The firm has been growing steadily over the past five (5) years and is operating at full capacity. Hull Motors has recently completed the addition of new plant & machine at a cost of $ 7,800.000. There by raising its manufacturing capacity to 100,000 motors yearly. The addition [0 plant and machine will be depreciated on a straight-line basis over 10 years.]

Sales of motors were 60,000 units prior to completion of the additional capacity. Cost records indicated that manufacturing costs had totaled dollar 60 per motor, of which $48 per motor was considered to be variable manufacturing costs. Hull Motors has used the volume of activity at full capacity as the basis for applying manufacturing overhead. The normal selling price is $80 per motor, & Hull Motors pays a 5 percent commission on the sale of its motors.

LawnPro has offered to buy 35,000 motors at a value of $60 per unit to test the viability of distributing lawn mower replacement motors through its site. Hull Motors would be expected to produce motors, store them in its ware home & ship individual motors to LawnPro consumers. As orders are placed directly through the LawnPro site, they would be forwarded instantly to Hull Motors. There will be no commissions paid on this sales order, & freight charges will be paid by the consumer purchasing a motor.

Required:

Identify key qualitative factors that Hull Motors management should consider with respect to his special order.

Cost Accounting, Accounting

  • Category:- Cost Accounting
  • Reference No.:- M923011

Have any Question? 


Related Questions in Cost Accounting

Requirementsdo not use any direct quotes andor cut and

Requirements: Do not use any direct quotes and/or cut and pasted information (i.e. your discussion is to be 100% your thoughts, ideals and insights). A minimum 350 words are required (this is the minimum and totally feel ...

Company expansion - internationallocate the financial

Company Expansion - International Locate the financial information for a company that has only domestic manufacturing operations. Assume management desires to expand into the global market with its current products. The ...

Cost of capital assignment questions -1 what does the cost

Cost of Capital Assignment Questions - 1. What does the cost of capital represents? What is should reflect? 2. How do taxes affect the cost of debt? 3. What are the retained earnings? Do they have any costs for the firm? ...

Quiz1 a process cost system would be used for all of the

QUIZ 1 A process cost system would be used for all of the following products except computer chips. chemicals. motion pictures. soft drinks. 2 Differences between a job order cost system and a process cost system include ...

Case questions rio grande medical center cost allocation

CASE QUESTIONS RIO GRANDE MEDICAL CENTER Cost Allocation Concepts 1. Is it "fair" for the Dialysis Center to suffer in profitability, and hence for the department head to possibly lose his bonus, just because the Outpati ...

Assignment cost accountingoverviewthe final project for

Assignment: Cost Accounting Overview The final project for this course is the creation of a quantitative analysis with a memo to management. Classifying a company's costs allows for an in-depth analysis of the impact tha ...

Module 3 - slpstrategic choicessimulationin module 3 you

Module 3 - SLP Strategic Choices SIMULATION In Module 3, you will use CVP analysis to inform the pricing of your 3 products. SCENARIO CONTINUATION: You've now completed SLP2, and it the date is (once again) January 1, 20 ...

Problem 1 master budgetomega inc has developed the

Problem 1: Master Budget Omega, Inc. has developed the following sales forecast for the first six months of the coming year Month Sales (in units) January 30,000 February 50,000 March 70,000 April 80,000 May 60,000 June ...

Question 1pringle company distributes a single product the

Question 1. Pringle Company distributes a single product. The company's sales and expenses for a recent month follow:   Total    Per Unit   Sales $ 300,000   $ 20        Variable expenses   210,000     14          Contri ...

Polarisreading the case and answer the all question polaris

Polaris Reading the case and answer the all question: Polaris: Suggested assignment questions Why does the Polaris outsource the manufacture of most components but in-source final assembly? Which manufacturing location o ...

  • 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

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro