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2 years ago

Use the following information to calculate the sales price of a boat under both GAAP and for internal decision purposes:

Business

1 answer:

IRINA_888 [86]2 years ago

7 0

Answer:

(A) $120,000 ; $136,800

Explanation:

The computation is shown below:

The sales price under GAAP would be

= (Direct materials per boat + Direct labor per boat + Overhead per boat) + (Markup percentage of total cost)

= ($50,000 + $30,000 + $20,000) + 20% × $100,000

= $100,000 + $20,000

= $120,000

The sales price under Internal decision purposes would be

= (Direct materials per boat + Direct labor per boat + Overhead per boat + Upstream costs per boat + downstream cost per boat ) + (Markup percentage of total cost)

= ($50,000 + $30,000 + $20,000 + $10,000 + $4,000) + 20% × $114,000

= $114,000 + $22,800

= $136,800

The upstream per boat would be

= $5,000,000 ÷ 500

= $10,000

And, the downstream per boar

= $2,000,000 ÷ 500

= $4,000

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Answer:

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Explanation:

Giving the following information:

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