FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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- Surf Company can sell all of the two surfboard models it produces, but it has only 412 direct labor hours available. The Glide model requires 2 direct labor hours per unit. The Ultra model requires 4 direct labor hours per unit. Contribution margin per unit is $212 for Glide and $324 for Ultra. (a) Compute the contribution margin per direct labor hour for each product. (b) Determine the best sales mix and the resulting contribution margin. Complete this question by entering your answers in the tabs below. Required A Required B Compute the contribution margin per direct labor hour for each product. Glide Ultra Contribution margin per direct labor hourarrow_forwardFollowing costs and revenue are incurred/earned by Toy inc. on each unit of teddy bear: Selling price Materials $49 $12 Labour $15 Variable overhead Fixed overhead $7 $6 Toy Inc. has received an offer from a customer. The customer is ready to buy 1,500 unitsat $37 each. However, the customer is asking for customized colouring on the teddy bear'spocket, which will require additional $1 per teddy bear. Should the offer from customer be accepted by Toy Inc.? Accept due to Incremental profit of $3,300. Reject due to Incremental loss of $3,000. Accept due to Incremental profit of $3,000 Reject due to incremental loss of $3,300arrow_forwardWood Chuck Furniture currently manufactures rocking chairs as its main product. Each chair uses one seat cushion and one back CUSHIO and one back): Direct materials Direct labor Variable overhead Fixed overhead Total $ 1 10 Wood Chuck should 5 8 $24 Shepert Company has contacted Wood Chuck with an offer to sell it 5,000 sets of cushions for $18 each. If Wood Chuck buys the cushions, $2 of the fixed overhead per unit will be allocated to other products. Should Wood Chuck make or buy the cushions? buy to save $ per set. SUPPORTarrow_forward
- A furniture company manufactures tables and chairs. A table requires 45 board-feet of wood, and a chair requires 20 board-feet of wood. Wood can be purchased at a cost of $1.90 per board-foot, and 25,000 board-feet of wood are available for purchase. It takes 2.5 hours of skilled labor to manufacture an unfinished table or an unfinished chair. Then 3 more hours of skilled labor will turn an unfinished table into a finished table, and 1.5 more hours of skilled labor will turn an unfinished chair into a finished chair. A total of 4500 hours of skilled labor is available (and have already been paid for). All furniture produced can be sold at the following unit prices: an unfinished table, $180; a finished table, $330; an unfinished chair, $130; and a finished chair, $200. a. Determine how to maximize the company’s profit from manufacturing tables and chairs. b. Use a two-way SolverTable to see how the numbers of unfinished products (both chairs and tables) sold depend on the selling…arrow_forwardUse the information provided to calculate standard costs: To make one switch it takes 19 feet of plastic-coated copper wire and 0.8 pounds of plastic material. The plastic material can usually be purchased for $20 per pound, and the wire costs $2.12 per foot. The labor necessary to assemble a switch consists of two types. The first type of labor is assembly, which takes 3.1 hours. These workers are paid $27 per hour. The second type of labor is finishing, which takes 2.4 hours. These workers are paid $28 per hour. Overhead is applied using labor hours. The variable overhead rate is $14.25 per labor hour. The fixed overhead rate is $15.26 per hour. What is the total standard cost for manufacturing overhead? Round to the nearest penny, two decimal places.arrow_forward! Required information [The following information applies to the questions displayed below.] BatCo makes baseball bats. Each bat requires 1.00 pounds of wood at $22 per pound and 0.30 direct labor hour at $20 per hour. Overhead is assigned at the rate of $40 per direct labor hour. Prepare a standard cost card for a baseball bat for BatCo. (Round your final answers to 2 decimal places.) Inputs Direct materials Direct labor Overhead Standard quantity or hours pounds DLH DLH Standard price or rate Standard cost per unitarrow_forward
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- Need help with homework.arrow_forwardSixthZ currently produces and sells 1,200 treehouses per year and sells them at $1200 per treehouse. SixthZ has the capacity to produce 1,400 treehouses. SixthZ has received a special order from the families in Davis's Village Homes community. They would like to buy 135 treehouses at a price of $800 per treehouse. The product unit cost for the treehouses is shown below: Direct Materials $500 Direct Labor $300 Variable Overhead $40 Fixed Overhead $100 SixthZ incurs no variable selling and administrative expenses. Should SixthZ accept the special order? O No, because accepting the order would result in a $113,400 decrease in operating income O No, because accepting the order would result in a $18,900 decrease in operating income O Yes, because accepting the order would result in a $54,000 increase in operating income O No, because accepting the order would result in a $5,400 decrease in operating incomearrow_forwardReuben's Deli currently makes rolls for deli sandwiches it produces. It uses 30,000 rolls annually in the production of deli sandwiches. The costs to make the rolls are: Costs Reuben's Deli cost data Amounts Materials Labor Variable overhead Fixed overhead Increments $0.24 per roll 0.40 per roll 0.16 per roll 0.20 per roll A potential supplier has offered to sell Reuben the rolls for $0.90 each. If the rolls are purchased, 30% of the fixed overhead could be avoided. If Reuben accepts the offer, what will the effect on profit be?arrow_forward
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