Wood Creations designs, manufactures, and sells modern wood sculptures. Sally Jensen is an artist for the company. Jensen has spent much of the past month working on the design of an intricate abstract piece. Jim Smoot, product development manager, likes the design. However, he wants to make sure that the sculpture can be priced competitively. Alexis Nampa, Wood’s cost accountant, presents Smoot with the following cost data for the expected production of 75 sculptures: $ 8,000 30,000 37,000 33,000 Design cost Direct materials Direct manufacturing labor Variable manufacturing overhead Fixed manufacturing overhead Marketing 25,000 15,000

Riders, Ltd. is a manufacturer that produces motorized scooters. Currently, it is producing the motor used to power the scooter, but is considering buying the motor from an outside supplier. The manufacturing costs for Riders to make 20,000 motors are as follows:    Cost per motor  Direct material $28.50 Direct labor $13.25 Overhead $18.00 An outside supplier offers to supply Riders with all the motors it needs at $55.00 per unit. If Riders buys the motors from the supplier, it will still incur 80% of its overhead costs. Based on the above information, the financial advantage (disadvantage) of buying the 20,000 motors from the outside supplier is:   a. ($265,000)   b. None of the other answers are correct   c. $95,000   d. ($193,000)   e. $23,000

Lakeside Inc. produces a product that currently sells for $60 per unit. Current production costs per unit include direct materials, $16; direct labor, $18; variable overhead, $11; and fixed overhead, $11. Product engineering has determined that certain production changes could refine the product quality and functionality. These new production changes would increase material and labor costs by 20% per unit. Lakeside has received an offer from a nonprofit organization to buy 9,200 units at $46 per unit. Lakeside currently has unused production capacity. Required: a. Calculate the effect on Lakeside's operating income of accepting the order from the nonprofit organization. Increase in operating income

Birkenstock is considering adding a new Big Buckle sandal to its current product offerings. Birkenstock expects to price the shoes at $125 per pair. The variable costs to produce one pair are estimated to be: $20 per pair direct materials; $25 per pair direct labor; $5 per pair shipping costs and $5 per pair miscellaneous overhead. The fixed costs for this line of shoes are: $50,000 advertising/promotion; $125,000 manufacturing plant manager salary; $350,000 depreciation expense on manufacturing equipment; and $50,000 other miscellaneous fixed costs. • Birkenstock's best guess is that they will sell 12,000 pairs of Big Buckle sandals in 2021. What is Birkenstock's expected 2021 profit on this product? Type your answer in the first blank below.

Marvel Parts, Incorporated, manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 990 hours each month to produce 1,980 sets of covers. The standard costs associated with this level of production are:     Total Per Set of Covers Direct materials $ 45,738 $ 23.10 Direct labor $ 6,930 3.50 Variable manufacturing overhead (based on direct labor-hours) $ 3,168 1.60   $ 28.20   During August, the factory worked only 1,000 direct labor-hours and produced 2,500 sets of covers. The following actual costs were recorded during the month:     Total Per Set of Covers Direct materials (10,000 yards) $ 56,000 $ 22.40 Direct labor $ 9,250 3.70 Variable manufacturing overhead $ 4,500 1.80   $ 27.90   At standard, each set of covers…

Marvel Parts, Incorporated, manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,035 hours each month to produce 2,070 sets of covers. The standard costs associated with this level of production are:     Total Per Set of Covers Direct materials $ 31,878 $ 15.40 Direct labor $ 6,210 3.00 Variable manufacturing overhead (based on direct labor-hours) $ 4,347 2.10   $ 20.50   During August, the factory worked only 500 direct labor-hours and produced 1,700 sets of covers. The following actual costs were recorded during the month:     Total Per Set of Covers Direct materials (5,000 yards) $ 25,500 $ 15.00 Direct labor $ 5,440 3.20 Variable manufacturing overhead $ 4,080 2.40   $ 20.60   At standard, each set of covers…

Deli's Fudge Factory currently makes fudge for retail and mail order customers. It also offers a variety of roasted nuts. Fudge sales have increased over the past year, so Deli is considering outsourcing the roasted nuts and using the roasting space to make additional fudge. A reliable supplier has quoted a price of £0.85 per pound for the roasted nuts. The following amounts reflect the in-house manufacturing costs per pound for the roasted nuts: Direct materials Direct labour Unit-related support costs Batch-related support costs Product-sustaining support costs Facility-sustaining support costs Total cost per pound £0.50 0.06 0.10 0.04 0.05 0.15 £0.90 Required: Should Deli's Fudge Factory outsource the roasted nuts? Why or why not? Discuss all items that should be considered. a.

In its production process, Purple Tree Inc uses a specialized part in the manufacturing of their fancy widget.  The costs to make a part are: direct material, $15; direct labor, $27; variable overhead, $15; and applied fixed overhead, $32. Purple Tree has received a quote of $60 from a potential supplier for this part. If Purple Tree buys the part, 75 percent of the applied fixed overhead would continue. They need 12,000 units of the specialized part.  Purple Tree Company would be better off by Group of answer choices $60,000 to buy the part. $348,000 to buy the part. $30,000 to manufacture the part. $216,000 to manufacture the part.

TS Electronics is a manufacturer with two departments: computer chips and cell phones. The computer chip that is produced in the Chips Department can be sold to customers at $6.25 per chip. The costs associated with the computer chips are as follows: (Click the icon to view the computer chip costs.) The Cell Phone Department has been purchasing the chips that it needs for $4.00 per chip from Chip Universe, but the manager was thinking that if the Chips Department could supply the chips for less than what Chip Universe is asking, then it would arrange a transfer between departments instead of giving the business to an external company. If the Cell Phone Department needs 240,000 computer chips and current production in the Chips Department is 480,000 chips, should a transfer take place? If so, at what price? (Note: For internal transfers, the selling and administrative costs are reduced to $0.45 per unit.) What other qualitative factors might need to be considered? First, let's determine…

Vikram