Herold manages a company that makes and sells two kinds of speakers, the Boomer and the Rocker. EachBoomer takes 7 hours to create the plastic parts, 4 hours to create the electronics, and 5 hours forassembly. Each Rocker requires 6 hours to create the plastic parts, 4 hours to create the electronics, and 10hours for assembly. The factory can handle a maximum of 3388 hours to create the plastic parts, 2008hours to create the electronics, and 3720 hours for assembly each week. If each Boomer generates $8 inincome, and each Rocker generates $6, how many of each of the speakers should Herold have the companymake and sell each week to earn the most income?Boomer:Rocker:Best income:

The objective of the question is to determine the number of each type of speakers (Boomer and…

Answered: Herold manages a company that makes and…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Talbot Industries manufactures two models of wireless headset: TI-12 and TI-28. Each product requires time on a single machine. The machine has a monthly capacity of 540 hours. Total market demand for the two products is limited to 2,000 units of TI-12 and 1,000 units of TI-28 monthly. Talbot is currently producing and selling 1,500 TI-12 models and 780 TI-28 models each month. Cost and machine-usage data for the two products are shown in the following spreadsheet, which analysts at Talbot use for production planning purposes: Price Less variable costs per unit Material Labor Overhead Contribution margin per unit Fixed costs Manufacturing Marketing and administrative Machine hours per unit Machine hours used Machine hours available Quantity produced Maximum demand Profit TI-12 $ 80 Required A Required B 23 29 8 $ 20 0.1
Zeus Company, a manufacturer of snowmobiles, is operating at 70% of plant capacity. Its plant manager is considering making the headlights now being purchased from an outside supplier for $13.60 each. The plant has idle equipment that could be used to manufacture the headlights. The design engineer estimates that each headlight requires $4.65 of direct materials, $3.65 of direct labor, and $6.65 of manufacturing overhead. Forty percent of the manufacturing overhead is a fixed cost that would be unaffected by this decision. A decision by the Company to manufacture the headlights should result in a net gain (loss) for each headlight of: $3.26. $(1.35). $2.64. $1.31.
A cement company produces preformed concrete blocks that requires three (3) hours of machine time. Machine hours are a scarce resource as a result of the productive capacity of the machines. The company has 70 machines. Each machine works 7 hours per day. The factory operates five (5) days per week and 50 weeks annually. The company sells each unit of this product for $360 and the product uses direct material costing $60 per unit. The total factory operating cost includes direct labour and production overheads. The average direct labour hour rate is $25 per hour. The company has 95 employees during the period who actually worked 8 hours per day. Overheads are absorbed using direct labour hours. The budgeted overheads for the period are $3,500,000. While the budgeted direct labour hours were 100,000 hours. Required: (a) Calculate the return per factory hour. (b) Calculate the cost per factory hour. (c) Calculate the TPAR.
IPort Products makes cases for portable music players in two processes, cutting and sewing. The cutting process has a capacity of 115,000 units per year; sewing has a capacity of 150,000 units per year. Cost information follows. Inspection and testing costs $ 47,500 Scrap costs (all in the cutting dept.) 147,500 Demand is very strong. At a sales price of $15.00 per case, the company can sell whatever output it can produce. IPort Products can start only 115,000 units into production in the Cutting Department because of capacity constraints. Defective units are detected at the end of production in the Cutting Department. At that point, defective units are scrapped. Of the 115,000 units started at the cutting operation, 17,250 units are scrapped. Unit costs in the Cutting Department for both good and defective units equal $11.30 per unit, including an allocation of the total fixed manufacturing costs of $264,500 per year to units. Direct…
Hannah Rama produces yoga mats using batting and bias tape, and fabric. To produce a mat requires 500 cm of fabric ($3 per meter) and 300 cm of batting and bias tape ($25 per meter). Each mat requires 3 minutes of labour ($19.5 per hour). In 2017, production of 40,000 mats was produced using 197,750 meters of fabric ($594,600), 119,250 meters of batting and bias tape ($151,450) and 2,150 hours ($41,750). Compute labour and material variances and mix and yield material variances and Explain why the variances happened.
Crede Inc. has two divisions. Division A makes and sells student desks. Division B manufactures and sells reading lamps. Each desk has a reading lamp as one of its components. Division A can purchase reading lamps at a cost of $10.10 from an outside vendor. Division A needs 11,100 lamps for the coming year. Division B has the capacity to manufacture 49,600 lamps annually. Sales to outside customers are estimated at 38,500 lamps for the next year. Reading lamps are sold at $12.09 each. Variable costs are $6.87 per lamp and include $1.41 of variable sales costs that are not incurred if lamps are sold internally to Division A. The total amount of fixed costs for Division B is $75,900. Consider the following independent situations. What should be the minimum transfer price accepted by Division B for the 11,100 lamps and the maximum transfer price paid by Division A? (Round answers to 2 decimal places, e.g. 15.25.) Per unit Minimum transfer price accepted by Division B $_ Maximum transfer…
Carlton’s Kitchens makes two types of pasta makers: Strands and Shapes. The company expects to manufacture 70,000 units of Strands, which has a per-unit direct material cost of $10 and a per-unit direct labor cost of $60. It also expects to manufacture 30,000 units of Shapes, which has a per-unit material cost of $15 and a per-unit direct labor cost of $40. It is estimatedthat Strands will use 140,000 machine hours and Shapes will require 60,000 machine hours. Historically, the company has used the traditional allocation method and applied overhead at a rate of $21 per machine hour. It was determined that there were three cost pools, and the overhead for each cost pool is shown: A. What is the per-unit cost for each product under the traditional allocation method?B. What is the per-unit cost for each product under ABC costing?
Talbot Industries manufactures two models of wireless headset: TI-12 and TI-28. Each product requires time on a single machine. The machine has a monthly capacity of 540 hours. Total market demand for the two products is limited to 2,000 units of TI-12 and 1,000 units of TI-28 monthly. Talbot is currently producing and selling 1,500 TI-12 models and 780 TI-28 models each month. Cost and machine-usage data for the two products are shown in the following spreadsheet, which analysts at Talbot use for production planning purposes: Price Less variable costs per unit Material Labor Overhead Contribution margin per unit Fixed costs Manufacturing Marketing and administrative Machine hours per unit Machine hours used Machine hours available Quantity produced Maximum demand Profit Required A Required B TI-12 Model TI-28 Model TI-12 $ 80 23 29 8 $ 20 units units 0.1
The Engine Division of Murphy Motor Corporation uses 5,000 carburetors per month in its production of automotive engines. It presently buys all of the carburetors it needs from two outside suppliers at an average cost of $100. The Carburetor Division of Murphy Motor Corporation manufactures the exact type of carburetor that the Engine Division requires. The Carburetor Division is presently operating at its capacity of 15,000 units per month and sells all of its output to a foreign car manufacturer at $106 per unit. Its cost structure (on 15,000 units) is: Variable production costs $70 Variable selling costs 10 All fixed costs 10 Assume that the Carburetor Division would not incur any variable selling costs on units that are transferred internally. Refer to Murphy Motor Corporation. What is the minimum of the transfer price range for a transfer between the two divisions?
.
Trident Ltd makes designer gold bracelets. Their annual costs include shop rent of $12,500, salaries for two jewellers of $118,000, design software costs of $10,000, and other overhead costs of $13,000. An average bracelet is priced at $5,500. It costs $2,000 in raw material, $1,250 in labour, and $250 in other expenses. What is the minimum number of bracelets that need to be sold to earn a profit? a.28 b. 44 c. 77 d. 17

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