Survey Of Accounting
5th Edition
ISBN: 9781259631122
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Question
Chapter 13, Problem 9E
a.
To determine
The contribution margin per unit.
To determine
Whether Company H should accept or reject the special order.
b.
To determine
The contribution margin income statement for the special order.
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Question 8
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Morales Corporation produces microwave ovens. The following per
unit cost information is available: direct materials $34, direct labor
$29, variable manufacturing overhead $15, fixed manufacturing
overhead $42, variable selling and administrative expenses $17,
and fixed selling and administrative expenses $26. Its desired ROI
per unit is $29. Compute the markup percentage using absorption-
cost pricing. (Round answer to 2 decimal places, eg
al
10.50%.)
Markup percentage
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Exercise 13-9A (Static) Using the contribution margin approach
for a special order decision LO 13-2
Hensely Company, which produces and sells a small digital clock, bases its pricing
strategy on a 25 percent markup on total cost. Based on annual production costs
for 25,000 units of product, computations for the sales price per clock follow.
Unit-level costs
Fixed costs
Total cost (a)
Markup (a x 0.25)
Total sales (b)
Sales price per unit (b÷ 25,000)
Required
$240,000
60,000
300,000
75,000
$375,000
$15
a. Hensely has excess capacity and receives a special order for 8,000 clocks for
$12 each. Calculate the contribution margin per unit. Based on this, should
Hensely accept the special order?
b. Prepare a contribution margin income statement for the special order.
Complete this question by entering your answers in the tabs below.
Required A Required B
Hensely has excess capacity and receives a special order for 8,000 clocks for $12 each
unit. Based on this, should Hensely accept the…
Exercise I-Set B
Palawan Company must determine a target selling price for one of its
products. Cost data relating to the product are as follows:
Per Unit
P 30
Direct materials
Direct labor
Variable manufacturing overhead
Fixed manufacturing overhead
Variable administrative and selling expenses
15
5
Fixed administrative and expenses
40
The costs above are based on an anticipated volume of 70,000 units
produced and sold each period. The company uses cost-plus pricing, and it has a
policy of obtaining target selling prices by adding a markup of 50% of unit
manufacturing cost or by adding a markup of 80% of variable costs.
Required: 1. Compute the target selling price per unit using absorption costing.
2. Compute the target selling price per unit using contribution costing.
Chapter 13 Solutions
Survey Of Accounting
Ch. 13 - Prob. 1QCh. 13 - Prob. 2QCh. 13 - Prob. 3QCh. 13 - Prob. 4QCh. 13 - Prob. 5QCh. 13 - Prob. 6QCh. 13 - Prob. 7QCh. 13 - Prob. 8QCh. 13 - Prob. 9QCh. 13 - Prob. 10Q
Ch. 13 - Prob. 11QCh. 13 - Prob. 12QCh. 13 - Prob. 13QCh. 13 - Prob. 14QCh. 13 - Prob. 15QCh. 13 - Prob. 16QCh. 13 - Prob. 17QCh. 13 - Prob. 18QCh. 13 - Prob. 19QCh. 13 - Prob. 1ECh. 13 - Prob. 2ECh. 13 - Prob. 3ECh. 13 - Prob. 4ECh. 13 - Exercise 6-5AOpportunity costs Norman Dowd owns...Ch. 13 - Prob. 6ECh. 13 - Prob. 7ECh. 13 - Prob. 8ECh. 13 - Prob. 9ECh. 13 - Prob. 10ECh. 13 - Exercise 6-11AEstablishing price for an...Ch. 13 - Exercise 6-12AOutsourcing decision with...Ch. 13 - Exercise 6-13AOutsourcing decision affected by...Ch. 13 - Prob. 14ECh. 13 - Exercise 6-15ASegment elimination decision Dudley...Ch. 13 - Prob. 16ECh. 13 - Exercise 6-17AAsset replacementopportunity cost...Ch. 13 - Prob. 18ECh. 13 - Exercise 6-19A Asset replacement decision Mead...Ch. 13 - Exercise 6-20A Asset replacement decision Kahn...Ch. 13 - Exercise 6-21A Annual versus cumulative data for...Ch. 13 - Problem 6-23A Context-sensitive relevance Required...Ch. 13 - Problem 6-24A Context-sensitive relevance...Ch. 13 - Problem 6-25A Effect of order quantity on special...Ch. 13 - Problem 6-26A Effects of the level of production...Ch. 13 - Problem 6-28A Eliminating a segment Western Boot...Ch. 13 - Effect of activity level and opportunity cost on...Ch. 13 - Problem 6-30A Comprehensive problem including...Ch. 13 - Prob. 29PCh. 13 - ATC 6-1 Business Application Case Analyzing...Ch. 13 - ATC 6-2 Group Assignment Relevance and cost...Ch. 13 - Prob. 3ATCCh. 13 - Prob. 4ATCCh. 13 - Prob. 5ATC
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