1 Cadence Computer currently manufactures the disk drives that it uses in its computers. The costs to produce 5,000 of these disk drives last year were as follows:Cost per drive2$Direct materialsDirect labor142Variable manufacturingoverheadFixed manufacturing overhead7Total28Rival Electronics has offered to provide Cadence with all of its disk drive needs for $27 per drive. If Cadence accepts this offer, Cadence will be able to use the freed up space to generate an additional$20,000 of income each year to produce more of its computer keyboards. Only $3 per drive of the fixed manufacturing overhead cost above could be avoided. Direct labor is an avoidable cost in thisdecision. Based on this information, would Cadence be financially better off making the drives or buying the drives and by how much?O A. $15,000 better to makeO B. $25,000 better to makeOC. $50,000 better to makeO D. $5,000 better to buy

Solution: (1). Total Cost Saving & Benefit of Buying outside Total Cost Other than fixed…

Cadence Computer currently manufactures the disk drives that it uses in its computers. Cost per drive Direct materials 14 Direct labor Variable manufacturing overhead 2 5 Fixed manufacturing overhead Total 7 28

Cadence Computer currently manufactures the disk drives that it uses in its computers. Cost per drive Direct materials 14 Direct labor Variable manufacturing overhead 2 5 Fixed manufacturing overhead Total 7 28

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Select one:a.(iii) and (iv) onlyb.(ii) and (iii) onlyc.(i) and (ii) onlyd.All four
3. What is the NAV?
5) Explain why we de-lever and re-lever the PL.
But why? for number 3
Zina Manufacturing Company started and completed Job 501 in December with the following Job Cost Sheet and transferred it to the warehouse. Direct Materials Date Dec 17 Dec 30 Total Direct Labor Amount Date Amount $2,000 Dec 20 $4,000 8,000 Dec 30 3,800 Total Job Cost Sheet - Job No. 501 Total Cost The journal entry to record the transaction is A) WIP Inventory FG Inventory B) Cost of Goods Sold WIP Inventory C) FG Inventory WIP Inventory D) FG Inventory WIP Inventory Debit Credit 35,800 17,800 17,800 Manufacturing Overhead Date Amount Dec 24 $10,000 Dec 30 8,000 Total 35,800 35,800 17,800 17,800 35,800
question G and f.
pls answer no. 4 and 5
What is the answer to d e and f?
Question 4 Listen Which of the following points are on the unit circle? Select all that apply. A (--) B (33.3) C 12 (1/13. 31/3)
Define Rule of 78