A manager of Varden Sporting Goods Company is considering accepting an order from an overseas customer. This customer has requested an order for 20,000 dozen golf balls at a price of $22 per dozen. The variable cost to manufacture a dozen golf balls is $18 per dozen. The full cost is $25 per dozen. Varden has a normal selling price of $35 per dozen. Var-den's plant has just enough excess capacity on the second shift to make the overseas order. What are some considerations in accepting or

A manager of Varden Sporting Goods Company is considering accepting an order from an overseas customer. This customer has requested an order for 20,000 dozen golf balls at a price of $22 per dozen. The variable cost to manufacture a dozen golf balls is $18 per dozen. The full cost is $25 per dozen. Varden has a normal selling price of $35 per dozen. Var-den's plant has just enough excess capacity on the second shift to make the overseas order. What are some considerations in accepting or

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter10: Short-term Decision Making

Section: Chapter Questions

Problem 4EB: Dimitri Designs has capacity to produce 30,000 desk chairs per year and is currently selling all...

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A manager of Varden Sporting Goods Company is considering accepting an order from an overseas customer. This customer has requested an order for 20,000 dozen golf balls at a price of $22 per dozen. The variable cost to manufacture a dozen golf balls is $18 per dozen. The full cost is $25 per dozen. Varden has a normal selling price of $35 per dozen. Varden's plan has just enough excess capacity on the second shift to make the overseas order. Instructions: What are some considerations in accepting or rejecting this order? Explain. Note: Be sure to properly cite other sources you include.
A manager of Varden Sporting Goods Company is considering accepting an order from an overseas customer. This customer has requested an order for 20,000 dozen golf balls at a price of $22 per dozen. The variable cost to manufacture a dozen golf balls is $18 per dozen. The full cost is $25 per dozen. Varden has a normal selling price of $35 per dozen. Varden's plan has just enough excess capacity on the second shift to make the overseas order. Instructions: What are some considerations in accepting or rejecting this order? Explain.
A manager of Burns Sporting Goods Company is considering accepting an order from an overseas customer. This customer has requested an order for 200,000 dozen golf balls at a price of $22 per dozen. The variable cost to manufacture a dozen golf balls is $18 per dozen. The full cost is $25 per dozen. Burns Sporting Goods Company plant has just enough excess capacity on the second shift to make the overseas order. What are some considerations in accepting or rejecting this order?
The printing department is considering buying 10,000 additional rolls of gray cloth from an outside supplier at $2,000 per roll, which is much higher than Dover’s cost of weaving the roll. The printing department expects that 10% of the rolls obtained from the outside supplier will result in defective products. Should the printing department buy the gray cloth from the outside supplier? Show your calculations.
A manager of Burns Sporting Goods Company is considering accepting an order from an overseas customer. This customer has requested an order for 200,000 dozen golf balls at a price of $22 per dozen. The variable cost to manufacture a dozen golf balls is $18 per dozen. The full cost is $25 per dozen. Burns Sporting Goods Company plant has just enough excess capacity on the second shift to make the overseas order. Discuss the considerations in accepting or rejecting the order.
manager of Dutch’s Sporting Goods Company is considering accepting an order from an overseas customer. This customer has requested an order for 20,000 dozen golf balls at a price of $15.00 per dozen. The variable cost to manufacture a dozen golf balls is $13.00 per dozen. The full cost is $17.00 per dozen. Dutch’s has a normal selling price of $23.00 per dozen. Dutch’s plant has just enough excess capacity on the second shift to make the overseas order. What are some considerations in accepting or rejecting this order?
The Mighty Music Company produces and sells a desktop speaker for $200. The company has the capacity to produce 60,000 speakers each period. At capacity, the costs assigned to each unit are as follows: Unit-level costs Product-level costs Facility-level costs The company has received a special order for 11,000 speakers. If this order is accepted, the company will have to spend $20,000 on additional costs. Assuming that no sales to regular customers will be lost if the order is accepted, at what selling price will the company be indifferent between accepting and rejecting the special order? Multiple Choice O O $96.82 $146.82 $104.32 $95 $25 $15 $107.32
A manager of Burns Sporting Goods Company is considering accepting an order from an overseas customer. This customer has requested an order for 200,000 dozen golf balls at a price of $22 per dozen. The variable cost to manufacture a dozen golf balls is $18 per dozen. The full cost is $25 per dozen. Burns Sporting Goods Company plant has just enough excess capacity on the second shift to make the overseas order. Given the information, should the order be accepted or rejected? What other considerations should be discussed in the decision? Be sure to provide explanation for your answer
Narra Company manufactures different designs of love seats. At the start, the company built a large plant with the expectation that the demand for its product will increase once the market is developed. However, at present, the company utilizes only 70% of its plant сaрacity. An account executive received an offer from a large mótel chain to purchase 250 units of love seats for a price of P950. Normal selling price for these seats is P1,500 each. Manufacturing costs for the current period's production of 420 love seats are presented below. Fixed cost is expected to be unchanged with the acceptance of the order. Production Costs for 420 units Materials P 147,000 Labor 126,000 Factory Overhead (60% fixed) 252,000 The account executive's commission for this order is 20%. If this special order proves to be acceptable, Narra is willing to reduce sales to regular customers so as not to exceed its plant capacity. What is the net advantage (disadvantage) of accepting the special order?
Maple Incorporated manufactures a product that costs $33 per unit plus $45,000 in fixed costs each month. Maple currently sells 4,000 of these units per month for $63 each. If Maple leased a machine for $12,000 a month, it could add features to the product that would allow it to increase the selling price. It would cost an additional $8 per unit to add these features. How much would Maple have to charge for the product with additional features to make it worthwhile to lease the machine?
Viper Avionics makes aircraft instrumentation. Its basic navigation radio requires $ 60 in variable costs and $5,000 per month in fixed costs. Further processing the radio, to enhance its functionality, will require an additional $28 per unit of variable costs, plus an increase in fixed costs of $ 290 per month. The marketing manager believes that they would be able to increase the sales price of the radio from $ 290 to $ 310 Viper sells 45 radios per month. If Viper decides to further process the radio, monthly operating income would
The JMT Creamery Co. produces ice-cream bars for vending machines and has an annual demand for 72000 bars. The Co. has the capacity to produce 400 bars per day. It takes only a few minutes to adjust the production set-up cost estimated at P7.50 per set up for the bars, and the firm is reluctant to produce too many at one time because the storage cost (refrigeration) is relatively high at P1.50 /bar/year. The firm supplies vending machines with its buko pie ice cream bars on 360 days of the year. (a) What is the most economical number of bars to produce during any one production run? (b) What is the optimal length of the production run in days? (c) What is the total inventory cost? (d) What is the maximum inventory level?