Business, 21.04.2020 04:30 elias37

Han Products manufactures 21,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is:

Direct materials $ 3.50
Direct labor 9.00
Variable manufacturing overhead 2.50
Fixed manufacturing overhead 9.00
Total cost per part $ 24.00
An outside supplier has offered to sell 21,000 units of part S-6 each year to Han Products for $20 per part. If Han Products accepts this offer, the facilities now being used to manufacture part S-6 could be rented to another company at an annual rental of $71,000. However, Han Products has determined that two-thirds of the fixed manufacturing overhead being applied to part S-6 would continue even if part S-6 were purchased from the outside supplier.

Required:

What is the financial advantage (disadvantage) of accepting the outside supplier’s offer?

Answers: 1

Show answers

Another question on Business

Business, 21.06.2019 16:10

You are at a holiday dinner with your family. your relative makes the argument that the u.s. economy is resurgent and has recovered from the great recession of 2007 – 2009. economic growth, as measured by gdp, has been increasing from one quarter to the next. you beg to differ. how would you structure your argument with your relative? hint: you should think about two things, the accuracy of gdp measures, and whether gdp should be considered a comprehensive measure of a countries well-being.

Answers: 3

Answer

Business, 22.06.2019 11:10

Which of the following is an example of a production quota? a. the government sets an upper limit on the quantity that each dairy farmer can produce. b. the government sets a price floor in the market for dairy products. c. the government sets a lower limit on the quantity that each dairy farmer can produce. d. the government guarantees to buy a specified quantity of dairy products from farmers.

Answers: 2

Answer

Business, 22.06.2019 12:30

On june 1, 2017, blossom company was started with an initial investment in the company of $22,360 cash. here are the assets, liabilities, and common stock of the company at june 30, 2017, and the revenues and expenses for the month of june, its first month of operations: cash $4,960 notes payable $12,720 accounts receivable 4,340 accounts payable 840 service revenue 7,860 supplies expense 1,100 supplies 2,300 maintenance and repairs expense 700 advertising expense 400 utilities expense 200 equipment 26,360 salaries and wages expense 1,760 common stock 22,360 in june, the company issued no additional stock but paid dividends of $1,660. prepare an income statement for the month of june.

Answers: 3

Answer

Business, 22.06.2019 18:30

Afarmer is an example of what kind of producer?

Answers: 2

Answer

You know the right answer?

Han Products manufactures 21,000 units of part S-6 each year for use on its production line. At this...

Questions