Current Attempt in ProgressIt costs Oriole Company $28 of variable costs and $14 of allocated fixed costs to produce an industrial trash can that sells for $88. Abuyer in Mexico offers to purchase 3500 units at $34 each. Oriole Company has excess capacity and can handle the additionalproduction. What effect will acceptance of the offer have on net income?O Decrease $28000O Increase $21000O Increase $119000O Increase $28000Save for LaterAttempts: 0 of 1 usedSubmit Answer

Additional sales (A) = 3,500 x $34$119,000Less: incremental variable cost (B) = 3,500 x…

Answered: Current Attempt in Progress It costs…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 9E: Gelbart Company manufactures gas grills. Fixed costs amount to 16,335,000 per year. Variable costs...

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Gelbart Company manufactures gas grills. Fixed costs amount to 16,335,000 per year. Variable costs per gas grill are 225, and the average price per gas grill is 600. Required: 1. How many gas grills must Gelbart Company sell to break even? 2. If Gelbart Company sells 46,775 gas grills in a year, what is the operating income? 3. If Gelbart Companys variable costs increase to 240 per grill while the price and fixed costs remain unchanged, what is the new break-even point?
It costs Bonita Industries $28 of variable costs and $13 of allocated fixed costs to produce an industrial trash can that sells for $64. A buyer in Mexico offers to purchase 5000 units at $31 each. Bonita Industries has excess capacity and can handle the additional production. What effect will acceptance of the offer have on net income? Select answer from the options below 1. Increase $155000 2. Increase $50000 3. Decrease $50000 4. Increase $15000
Current Attempt in Progress Your answer is partially correct. Cullumber Company incurs a cost of $35 per unit, of which $19 is variable, to make a product that normally sells for $58. A foreign wholesaler offers to buy 5,600 units at $30 each. Cullumber will incur additional costs of $1 per unit to imprint a logo and to pay for shipping. Compute the increase or decrease in net income Cullumber will realize by accepting the special order, assuming Cullumber has sufficient excess operating capacity. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Revenues Costs $ Net income $ Reject $ $ Should Cullumber Company accept the special order? Cullumber company should accept V the special order. Accept 168000 112000 i 56000 $ $ Net Income Increase (Decrease) 168000 112000 56000
It costs Bonita Industries $11 of variable and $5 of fixed costs to produce one scale which normally sells for $43. A foreign wholesaler offers to purchase 4100 scales at $15 each. Garner would incur special shipping costs of $1 per scale if the order were accepted. Bonita has sufficient unused capacity to produce the 4100 scales. If the special order is accepted, what will be the effect on net income? O $12300 increase $12300 decrease O $49200 decrease $61500 increase
It costs Concord Corporation $28 of variable costs and $16 of allocated fixed costs to produce an industrial trash can that sells for $82. A buyer in Mexico offers to purchase 3000 units at $33 each. Concord Corporation has excess capacity and can handle the additional production. What effect will acceptance of the offer have on net income? A. Increase $15000 B. Increase $33000 C. Decrease $33000 D. Increase $99000
Use this information for Stryker Industries to answer the question that follow. Stryker Industries received an offer from an exporter for 30,000 units of product at $19 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $23 Unit manufacturing costs: Variable 10 Fixed 5 What is the amount of income or loss from the acceptance of the offer? Oa. $300,000 loss Ob. $690,000 loss Oc. $570,000 income Od. $270,000 income Previous Next 7:36 PM CP 12/13/2020
It costs Sheridan Company $12 of variable and $5 of fixed costs to produce one bathroom scale which normally sells for $35. A foreign wholesaler offers to purchase 1700 scales at $15 each. Garner would incur special shipping costs of $1 per scale if the order were accepted. Sheridan has sufficient unused capacity to produce the 1700 scales. If the special order is accepted, what will be the effect on net income? $5100 decrease $3400 decrease $3400 increase $25500 increase
Vaughn Manufacturing has the following costs when producing 100000 units: Variable costs $600000 Fixed costs 900000 An outside supplier has offered to make the item at $4.50 a unit. If the decision is made to purchase the item outside, current production facilities could be leased to another company for $167000. The net increase (decrease) in the net income of accepting the supplier's offer is O $317000. O $(17000). O $832000. O $283000.
It costs Vaughn Manufacturing $12 of variable and $5 of fixed costs to produce one bathroom scale which normally sells for $35. A foreign wholesaler offers to purchase 2600 scales at $15 each. Garner would incur special shipping costs of $1 per scale if the order were accepted. Vaughn has sufficient unused capacity to produce the 2600 scales. If the special order is accepted, what will be the effect on net income? $7800 decrease $39000 increase $5200 increase $5200 decrease
It costs Crane Company $12 of variable and $5 of fixed costs to produce one bathroom scale which normally sells for $35. A foreign wholesaler offers to purchase 1500 scales at $15 each. Garner would incur special shipping costs of $1 per scale if the order were accepted. Crane has sufficient unused capacity to produce the 1500 scales. If the special order is accepted, what will be the effect on net income? $4500 decrease $3000 increase $22500 increase $3000 decrease
Current Attempt in Progress Sheffield Corp. manufactures a product with a unit variable cost of $100 and a unit sales price of $186. Fixed manufacturing costs were $480000 when 10000 units were produced and sold. The company has a one-time opportunity to sell an additional 1000 units at $140 each in a foreign market which would not affect its present sales. If the company has sufficient capacity to produce the additional units, acceptance of the special order would affect net income as follows: O Income would decrease by $8000. O Income would increase by $140000. O Income would increase by $40000. O Income would increase by $8000.
Use this information for Stryker Industries to answer the question that follow.Stryker Industries received an offer from an exporter for 15,000 units of product at $17.50 per unit. The acceptance of the offer will not affect normal production or domestic sales prices. The following data are available: Domestic unit sales price $20 Unit manufacturing costs: Variable 11 Fixed 1 What is the amount of income or loss from the acceptance of the offer?

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