Walnut; Incorporated has received a special order for 2,000 units of its product at a special price of $150. The product normally sells for $200 and has the following manufacturing costs: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total unit cost Cost per Unit $ 60 40 30 50 $ 180 Walnut is currently operating at full capacity and cannot fill the order without harming normal production and sales. If Walnut accepts the order, what effect will the order have on the company's short-term profit?
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- A company is considering a special order for 1,000 units to be priced at 8.90 (the normal price would be 11.50). The order would require specialized materials costing 4.00 per unit. Direct labor and variable factory overhead would cost 2.15 per unit. Fixed factory overhead is 1.20 per unit. However, the company has excess capacity, and acceptance of the order would not raise total fixed factory overhead. The warehouse, however, would have to add capacity costing 1,300. Which of the following is relevant to the special order? a. 11.50 b. 1.20 c. 7.35 d. 8.90Boston Executive. Inc., produces executive limousines and currently manufactures the mini-bar inset at these costs: The company received an offer from Elite Mini-Bars to produce the insets for $2,100 per Unit and supply 1,000 mini-bars for the coming years estimated production. If the company accepts this offer and shuts down production of this part of the business, production workers and supervisors will be reassigned to other areas. Assume that for the short-term decision-making process demonstrated in this problem, the companys total labor costs (direct labor and supervisor salaries) will remain the same if the bar inserts are purchased. The specialized equipment cannot be used and has no market value. However, the space occupied by the mini bar production can be used by a different production group that will lease it for $55,000 per year. Should the company make or buy the mini-bar insert?Zena Technology sells arc computer printers for $55 per unit. Unit product costs are: A special order to purchase 15,000 arc printers has recently been received from another company and Zena has idle capacity to fill the order. Zena will incur an additional $2 per printer for additional labor costs due to a slight modification the buyer wants made to the original product. One-third of the manufacturing overhead costs is fixed and will be incurred no matter how many units are produced. When negotiating the price, what is the minimum selling price that Zena should accept for this special order?
- Regal Executive, Inc., produces executive motor coaches and currently manufactures the cent awnings that accompany them at these costs: The company received an offer from Saied Tents to produce the awnings for $3,200 per unit and supply 1,000 awnings for the coming years estimated production. If the company accepts this offer and shuts down production of this part of the business, production workers and supervisors will be reassigned to other areas. Assume that for the short-term decision-making process demonstrated in this problem, the companys total labor costs (direct labor and supervisor salaries) will remain the same if the bar inserts are purchased. The specialized equipment cannot be used and has no market value. However, the space occupied by the awning production can be used by a different production group that will lease it for $60,000 per year. Should the company make or buy the awnings?Trifecta Distributors has decided to discontinue manufacturing its X Plus model. Currently, the company has 4,600 partially completed X Plus models on hand. The government has put a recall on a particular part in the X Plus model, so each base model must now be reworked to accommodate the style of the new part. The company has spent $110 per unit to manufacture these X Plus models to their current state. Reworking each X Plus model will cost $20 for materials and $20 for direct labor. In addition, $7 of variable overhead and $32 of allocated fixed overhead (relating primarily to depreciation of plant and equipment) will be allocated per unit. Il Trifecta completes the X Plus models, it can sell them for $160 per unit. On the other hand, another manufacturer is interested in purchasing the partially completed units for $104 each and converting them into Z Plus models. Prepare a differential analysis per unit to determine if Trifecta should complete the X Plus models or sell them in their current state.Capitol, Incorporated, has received a special order for 2,080 units of its product at a special price of $158. The product normally sells for $208 and has the following manufacturing costs: Cost per Unit Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total unit cost $ 58 38 28 48 $ 172 Assume that Capitol has sufficient capacity to fill the order without harming normal production and sales. Required: a. If Capitol accepts the order, what effect will the order have on the company's short-term profit? b. What minimum unit price should Capitol charge to achieve a $48,000 incremental profit? c. Now, assume Capitol is currently operating at full capacity and cannot fill the order without harming normal production and sales. If Capitol accepts the order, what effect will the order have on the company's short-term profit? Complete this question by entering your answers in the tabs below. Required A Required B Required C If Capitol accepts the order,…
- Capitol, Incorporated has received a special order for 2,000 units of its product at a special price of $195. The product normally sells for $260 and has the following manufacturing costs: Cost per Unit Direct materials $ 78 Direct labor 52 Variable manufacturing overhead 39 Fixed manufacturing overhead 65 Total unit cost $ 234 Assume that Capitol has sufficient capacity to fill the order without harming normal production and sales. Required: If Capitol accepts the order, what effect will the order have on the company’s short-term profit? What minimum unit price should Capitol charge to achieve a $65,000 incremental profit? Now, assume Capitol is currently operating at full capacity and cannot fill the order without harming normal production and sales. If Capitol accepts the order, what effect will the order have on the company’s short-term profit?Cranberry has received a special order for 150 units of its product at a special price of $1,900. The product normally sells for $2,400 and has the following manufacturing costs: Per unit Direct materials $ 680 Direct labor 380 Variable manufacturing overhead 480 Fixed manufacturing overhead 580 Unit cost $2,120 Assume that Cranberry has sufficient capacity to fill the order without harming normal production and sales. If Cranberry accepts the order, what effect will the order have on the company's short-term profit? Multiple Choice $54,000 increase $33,000 increase $33,000 decrease $87,000 decreaseJohn has received a special order for 100 units of its product at a special price of $2,100. The product normally sells for $2,800 and has the following manufacturing costs: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Unit cost Per unit $ 840 420 560 700 $2,52 0 Assume that John has sufficient capacity to fill the order without harming normal production and sales. If John accepts the order, what effect will the order have on the company's short-term profit?
- Cranberry has received a special order for 170 units of its product at a special price of $2,350. The product normally sells.for $2,850 and has the following manufacturing costs: Per unit Direct materials 770 Direct labor 470 Variable manufacturing overhead 570 Fixed manufacturing overhead 670 51 Unit cost $2,480 Assume that Cranberry has sufficient capacity to fill the order without harming normal production and sales. If Cranberry accepts the order, what effect will the order have on the company's short-term profit?Diskmar has received a special order for 2,000 units of its product at a special price of $75. The product normally sells for $100 and has the following manufacturing costs:Direct material costs are $30; Direct labor costs are $20; and Variable Overhead costs are $15. Assume that Diskmar has sufficient capacity to fill the order without harming normal production and sales. a. If Diskmar accepts the order, what effect will the order have on the company's short-term profit? b. What minimum price should Diskmar charge to achieve a $25,000 incremental profit? c. Now assume Diskmar is currently operating at full capacity and cannot fill the order without harming normal production and sales. If Diskmar accepts the order, what effect will the order have on the company's short-term profit?Luca Inc. has received a special order for 2,000 units of its product at a special price of $75. The product normally sells for $100 and has the following manufacturing costs: Assume that Luca Inc. has sufficient capacity to fill the order without harming normal production and sales. If Luca Inc. accepts the order, what effect will the order have on the company's short-term profit? Per Unit Direct materials $30 Direct labor $20 Variable manufacturing overhead $15 Fixed manufacturing overhead $25 a. $50,000 decrease b. $30,000 increase c. $20,000 increase d. $30,000 decrease