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Sphinxa [80]
2 years ago
3

Mallory Company manufactures widgets. Bowden Company has approached Mallory with a proposal to sell the company widgets at a pri

ce of $82,000 for 100,000 units. Mallory is currently making these components in its own factory. The following costs are associated with this part of the process when 100,000 units are produced: Direct material $ 31,000 Direct labor 29,000 Manufacturing overhead 40,000 Total $100,000 The manufacturing overhead consists of $16,000 of costs that will be eliminated if the components are no longer produced by Mallory. From Mallory's point of view, how much is the incremental cost or savings if the widgets are bought instead of made?
Business
1 answer:
Nastasia [14]2 years ago
8 0

Answer:

It is cheaper to make the products in-house by $6,000.

Explanation:

Giving the following information:

Buy:

Total cost= $82,000

The number of units= 100,000

Production:

Total cost= $100,000

The number of units= 100,000

Unavoidable manufacturing overhead= 40,000 - 16,000= $24,000

<u>We need to add the unavoidable manufacturing overhead costs to the buying option to determine the actual total cost:</u>

Buy= 82,000 + 24,000= $106,000

It is cheaper to make the products in-house by $6,000.

You might be interested in
Purple Corporation acquired 75 percent of Socks Corporation’s common stock on January 1, 20X8, for $435,000. At that date, Socks
Ivahew [28]

Answer:

20X8 = 162,000

20X9 = $197,000

Explanation:

The calculation of the consolidated comprehensive income for the year 2008 and 2009 is shown below:

                         Consolidated comprehensive income

Particulars                                              20X8        20X9

Purple Corporation

Operating Income                             $120,000         $140,000  

Add: Net Income

from Socks Corporation             $40,000          $60,000  

Less: Amortization of differential

($80,000 ÷  10 Years)                    ($8,000)         (8,000)  

Consolidated net income            $152,000         $192,000  

Add: Comprehensive income

reported by Socks Corporation    $10,000          $5,000  

Consolidated

comprehensive income            $162,000          $197,000

3 0
2 years ago
Maria, age 28, wants to pay no more than $300 a year in life insurance. What is the face value of the largest 20-year term polic
VMariaS [17]

Answer:

Explanation:

Net Cost of Life Insurance Premium : Life insurance policy entails Premium to be paid by the insured at a monthly / quarterly interval. insured often gets dividend from the insurance company and in that case, the net cost of premium will be low

The 20 years premium can be calculated with Annual Premium which is not given in the question, therefore i will solve for all the option but please pick the answer that the Annual premium is with you

a)   20 years premium = Annual Premium x Number of years

                                     = 11700 x 20

                                    = 234,000

b)   20 years premium = Annual Premium x Number of years

                                     = 7900 x 20

                                    = 158,000

c)  20 years premium = Annual Premium x Number of years

                                     = 550 x 20

                                    = 11,000

d)  20 years premium = Annual Premium x Number of years

                                     = 28350 x 20

                                    = 567,000

7 0
2 years ago
Abe receives a check from Bea for fixing Bea's car. Bea's bank is Bank B. Abe deposits the check into his bank, Bank A. Select a
pentagon [3]

Answer:

Bank A increases its reserves at the Federal Reserve Bank by more than the amount of the check.

Bank A increases Abe's checkable deposits by the amount of the check.

Total reserves in the banking system remain unchanged.

Explanation:

In the case when Abe received the check from bea in order to fixed out the bea car so here Bank A should increased the reserve that should be exceed the check amount

Also it increased the abe checkable deposit via the amount check and the total reserves should remain the same

These should be considered

3 0
1 year ago
Last year, the Miller Company reported a return on assets of 15 percent and an asset turnover of 1.6. In the current year, the c
Tema [17]

Answer:

b. Asset turnover decreased, therefore, total assets had to increase. If total assets increased, yet the return on assets also increased, then net income also had to increase.

Explanation:

The options are as follows

a. Asset turnover decreased, therefore, total assets had to decrease. If total assets decreased, yet the return on assets also increased, then net income also had to increase.

b. Asset turnover decreased, therefore, total assets had to increase. If total assets increased, yet the return on assets also increased, then net income also had to increase.

c. Asset turnover decreased, therefore, total assets had to decrease. If total assets decreased, yet the return on assets also increased, then net income also had to decrease.

d. Asset turnover decreased, therefore, total assets had to increase. If total assets increased, yet the return on assets also increased, then net income also had to decrease.

Let us assume the sales is $100,000

So, the asset turnover equal to

Asset turnover = Sales ÷ Total Assets

1.6 = $100,000 ÷ Total assets

Total assets = $62,500

Now the return on assets equal to

Return on assets = Profit ÷ Total Assets

15% = Profit ÷ $62,500

So, the profit is $9,375

Now in the current year

The asset turnover equal to

Asset turnover = Sales ÷ Total Assets

1.2 = $100,000 ÷ Total assets

Total assets = $83,333.33

Now the return on assets equal to

Return on assets = Profit ÷ Total Assets

19% = Profit ÷ $83,333.33

So, the profit is $15,833.33

Now the increase in asset and profit is

Increase in asset = ($83,333.33 - $62,500) ÷ (62500)

= 33.33%

And, the increase in profit is

= ($15,833.33,- $9,375) ÷ ($9,375)

= 68.89%

As we can see that the increase in asset decreased but at the same time the increase in profit increases that results in increases in total assets and the increment in return on assets.

3 0
2 years ago
Suppose that the Dallas School District wants to achieve Six Sigma quality levels of performance in delivering students to schoo
Kay [80]

Answer:

a) 1.66 minutes

b) 3.4 out of million deliveries

Explanation:

So, it is a six sigma quality question, we first need to understand little bit about six sigma and how it is to achieve six sigma level.

<u>Six Sigma:</u>

It is the process or technique used by many organizations through out the world to achieve maximum quality in a product or in a service they are providing. It helps to indicate root causes of the process or you can say waste steps which first need to be identified then rectified to bring that top-notch quality in the system. So in this case, in order to calculate part a) we will calculate six sigma control limits.

a) So, for six sigma control limits, the maximum allowable standard deviation is 12 or you can say +6 + (-6) = ±6 = 12. It means all deviations must lie in all 12 standard deviations.

<em>Please refer to the table shown in the attachment.</em> This bell curve represent six sigma concept. In this <em>3 sigma quality level means all deviations must lie in 6 standard deviations.</em>

So, here we have been given that mean = 20, so with mean we can calculate standard deviation in six sigma control limits.

Maximum Allowable Standard Deviation for 6 sigma = Mean/12

                                                                                        = 20/12

                                                                                       = 1.66

So, 1.66 is the maximum allowable standard deviation of arrival times required in order to achieve 6 sigma quality level.

b) In this part, we are asked that, out of million deliveries about how many times bus deliver students too early or too late at this 6 sigma quality level.

<em>For this answer, please refer to attachment again</em>. and notice at the left bottom with the arrow of 6 sigma, we have a number 3.4 ppm means 3.4 part per million.

<em>So, it 3.4 times in a million deliveries bus will deliver students either too early or too late. </em>

8 0
2 years ago
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