Calc, Inc. owns a machine that produces baskets for the gift packages the company sells. The company uses 900 baskets in production each month. The costs of making one basket is $4 for direct materials, $3 for variable manufacturing overhead, $2 for direct labor, and $5 for fixed manufacturing overhead. The unit cost is based on the monthly production of 900 baskets. The company determined that 30% of the fixed manufacturing overhead is avoidable. An outside supplier has offered to sell Calc the baskets for $13 each, and can supply all the units it needs.

Required:
a. Prepare an incremental analysis to determine if Calc should buy the baskets from the supplier.
b. Show the impact on net income and indicate whether they should make or buy the baskets.

Answers

Answer 1

Answer:

                        Cost Structure of producing 900 units

Particulars                                       Cost         Monthly                Total cost

                                                      per unit   production Units  

Direct material cost                           4                900                    $3,600

Direct Labor                                       2                 900                    $1,800

Variable manufacturing overheads 3                  900                    $2,700

Fixed Manufacturing overhead

Avoidable (30% of $5)                     2                   900                    $1,350

Unavoidable (70% of $5)                 4                   900                    $3,150

Total cost of making 900 units                                            $12,600

          Cost Structure of buying 900 units from outside supplier

Particulars                                 Cost per   Units required     Total cost

                                                      unit           to buy

Cost of purchase                          13                900                    $11,700

Fixed Manufacturing overhead

Unavoidable                                                                       $3,150

Total cost of buying 900 units                                       $14,850

Conclusion: Because the cost of making is lesser than cost of buying bythe amount of $2,250, the company will have to choose option of making the basket.


Related Questions

Poole Co. acquired 100% of Mullen Inc. on January 3, 2021. During 2021, Poole sold goods to Mullen for $2,500,000 that cost Poole $1,850,000. Mullen still owned 30% of the goods at the end of the year. Cost of goods sold was $11,200,000 for Poole and $6,600,000 for Mullen. What was consolidated cost of goods sold?
a) $15,105,000.
b) $15,300,000.
c) $15,495,000.
d) $17,800,000.

Answers

Answer:

c) $15,495,000.

Explanation:

Calculation to determine the consolidated cost of goods sold

First step is to calculate the Intra-Entity Gross Profit Deferred

Intra-Entity Gross Profit Deferred =($2,500,000 − $1,850,000)*30%

Intra-Entity Gross Profit Deferred =$650,000 × (30%)

Intra-Entity Gross Profit Deferred =$195,000

Now let calculate the Consolidated COGS

Using this formula

Consolidated COGS = Parent's COGS+Subsidiary's COGS -COGS in Intra-Entity Transfer+Intra-Entity Gross Profit Deferred

Let plug in the formula

Consolidated COGS=$11,200,000+ $6,600,000− $2,500,000+ $195,000

Consolidated COGS= $15,495,000

Therefore the consolidated cost of goods sold is

$15,495,000

Department stores have increasingly used designer boutiques to highlight specific designers to small market segments. This strategy most closely resembles that of which retail institution

Answers

Answer:

Specialty Store

Explanation:

A specialty store is a store where it keeps the high brand, style or models having the narrow category of goods and services. The products like furniture, sporting goods, bookstores are categorized as the speciality stores.

Since in the given situaton, it is mentioned that the stores increase the usage of the designer boutique for highlighting the particular designers for the small market so this represent the speciality store of that retail institution

1. Why are fewer customers entering local bank branches?(Select all that apply)
Mobile phone apps
Online banking
Due to the sophistication of ATM machines
Limited branch hours


2. What type of business are banks relying on to maintain the “brick-and-mortar” branches.
A. New accounts and loans
B. Account transfers
C. Cash withdrawals
D. Check deposits


3. What is the primary reason a consumer needs to walk into a bank branch?
A. Withdraw funds
B. Make a deposit
C. Open a new account
D. Transfer funds


Answers

Answer:

2.a. new account and loans, 3. b. make a deposit

What is the difference between economics and geography? -,-​

Answers

Answer:

Economics is a Bhadda subject aur geo Ki to pucho he mat ok bye

Gibson Electronics identifies licensees in various countries who produce and sell the company's products in their countries in return for a royalty fee on every unit sold. Gibson Electronics’ approach is risky because of the problems associated with:_______
a. increased production costs.
b. doing business in a different culture where the rules of the game may be very different.
c. an increase in transportation costs, especially for those products that have a low value-to-weight ratio.
d. the possibility of an increase in trade barriers such as import tariffs or quotas.
e. sharing valuable technological know-how with a potential competitor.

Answers

Answer:

E) sharing valuable technological know-how with a potential competitor.

Explanation:

From the question we are informed about Gibson Electronics who identifies licensees in various countries who produce and sell the company's products in their countries in return for a royalty fee on every unit sold. Gibson Electronics’ approach is risky because of the problems associated with sharing valuable technological know-how with a potential competitor. Technological know-how in organization can be regarded as sets of knowledge as well as skills which is developed by that participants and is used to guide the acquisition as well as creation, and operation of computer-based systems which gives enablements or brings about facilitation of the performance of business processes, sharing this with competitors in business could be dangerous potential competitors can embrace it to move their business forward which will affect the owner of the Technological know how Businesses in the market.

Paraguay Pipes Inc. has a cost of equity of 11.1 percent, the YTM on the company's bonds is 5.7 percent, and the tax rate is 35 percent. The company's bonds sell for 93.1 percent of par. The debt has a book value of $393,000 and total assets have a book value of $947,000. If the market-to-book ratio is 2.59 times, what is the company's WACC?

Answers

Answer: 9.5978%

Explanation:

Firstly, we should note that the total book value of equity will be the difference between the total assets book value and the total debt book value which will be:

= $947,000 - $393,000

= $554,000

Then, we'll calculate the market value which will be:

= market-to-book ratio × book value

= 2.59 × $554,000

= $1,434,860

Then, the after tax cost of debt will be:

= 5.7(1 - Tax rate)

= 5.7(1 - 35%)

= 5.7(1 - 0.35)

= 5.7(0.65)

= 3.705%

Equity = $1,434,860

Debt = $393,000 × 93.1%

= $365883

Total market value = $1,800,743

WACC = Respective costs × Respective weights

= ($1,434,860/$1,800,743 × 11.1%) + ($365883/$1,800,743 × 3.705%)

= 0.08845 + 0.007528

= 0.095978

= 9.5978%

A company has two departments, Y and Z that incur wage expenses. An analysis of the total wage expense of $43,000 indicates that Dept. Y had a direct wage expense of $6,800 and Dept. Z had a direct wage expense of $10,700. The remaining expenses are indirect and analysis indicates they should be allocated evenly between the two departments. Departmental wage expenses for Dept. Y and Dept. Z, respectively, are:

Answers

Answer:

$19,550 and $10,250

Explanation:

Calculation to determine what Departmental wage expenses for Dept. Y and Dept. Z, respectively, are:

First step is to calculate the Indirect wages

Indirect wages = [43,000 - (6800+10700)]/2

Indirect wages= 43,000-17500/2

Indirect wages=24,500/2

Indirect wages = 12,750

Now let calculate Departmental wage expenses for Dept. Y and Dept. Z,

Departmental wage expenses for Dept. Y

=6800 + 12,750

Departmental wage expenses for Dept. Y = $19,550

Departmental wage expenses for Dept. Z=10,700 + 12,750

Departmental wage expenses for Dept. Z= 23450

Therefore Departmental wage expenses for Dept. Y and Dept. Z, respectively, are:$19,550 and $10,250

Suppose there are two breakfast restaurants in your college town, Waffle Kingdom and Flip's Flapjacks, and they decide to operate collusively as a cartel. If both restaurants abide by the cartel's agreement, each will earn $80000 in profit. If both restaurants cheat on the cartel's agreement, both will earn $15000 in profit. If one restaurant cheats and the other abides by the agreement, the cheater will earn a profit of $120000, while the restaurant that abides will have a loss of $7500. The most profitable combined outcome for the two restaurants would be:____________

a. for both restaurants to abide by the cartel’s agreement.
b. for both restaurants to cheat on the cartel’s agreement.
c. for Waffle Kingdom to cheat on the agreement and Flip’s Flapjacks to abide by the agreement.
d. There is not a profitable outcome for both restaurants.

Answers

Answer:

a. for both restaurants to abide by the cartel’s agreement.

Explanation:

As per the given situation, the most profitable outcome i.e. combined for the two restaurants is that the both restaurant should be abide via cartel agreement as in the both cases the earnings is $80,000 so this represent the most profitable condition for these two restaurants

Hence, the option a is correct

And, the rest of the options are wrong

Suppose an investment offers to triple your money in 24 months (don't believe it). What rate of return per quarter are you being offered

Answers

Answer:

30.77%

Explanation:

Assume investment = $1

Assume mount after 24 months = $5

Number of quarters in 24 months = 24/4 = 6

Future value = P*(1+r)^n; Where P is payment, r is interest rate per period, n is number of periods

5000 = 1*(1+i)^6

1*(1+i) = 5^(1/6)

1+i = 1.30766048601

i = 1.30766048601 - 1

i = 0.30766048601

i = 30.77%

So, the rate of return per quarter being offered is 30.77%

"Stock in Daenerys Industries has a beta of 0.73. The market risk premium is 10 percent, and T-bills are currently yielding 5 percent. The company's most recent dividend was $1.6 per share, and dividends are expected to grow at a 5.5 percent annual rate indefinitely. If the stock sells for $35 per share, what is your best estimate of the company's cost of equity? Use the average from CAPM and Dividend Growth Model calculations."

Answers

Answer:

CAPM = 12.30%

Dividend Growth Model=  10.32%

Explanation:

According to the capital asset price model: Expected rate of return = risk free + beta x (market premium)

5% + (0.73 x 10%) = 12.30%

according to the constant dividend growth model

price = d1 / (r - g)

d1 = next dividend to be paid

r = cost of equity

g = growth rate

$35 = $1.6 x (1.055) / (r - 0.055)

r = 1.688 / 35 + 0.055 = 0.1032 = 10.32%

Compute Lead Time Jackson Fabricators Inc. machines metal parts for the automotive industry. Under the traditional manufacturing approach, the parts are machined through two processes: milling and finishing. Parts are produced in batch sizes of 40 parts. A part requires 6 minutes in milling and 8 minutes in finishing. The move time between the two operations for a complete batch is 5 minutes. Under the lean philosophy, the part is produced in a cell that includes both the milling and finishing operations. The operating time is unchanged; however, the batch size is reduced to 5 parts and the move time is eliminated. Determine the value-added, non-value-added, and total lead times, and the value-added ratio under the traditional and lean manufacturing methods. If required, round percentages to one decimal place. Traditional Philosophy Lean Manufacturing Philosophy Value-added time fill in the blank 1 min fill in the blank 2 min Non-value-added time fill in the blank 3 min fill in the blank 4 min Total lead time fill in the blank 5 min fill in the blank 6 min Value-added ratio (as a percent) fill in the blank 7 % fill in the blank 8 %

Answers

Answer: See explanation

Explanation:

Traditional philosophy:

Value added time = 6 + 8 = 14

Non-value-added time = 14 × (40-1) + 5 = 551

Total lead time = 14 + 551 = 565

Value-added ratio (as a percent) = 14/565 × 100 = 2.48%

Lean Manufacturing Philosophy:

Value added time = 14

Non-value-added time = 14 × (5-1) = 56

Total lead time = 14 + 56 = 70

Value-added ratio (as a percent) = 14/70 × 100 = 20%

Evaluate the product-company and product market fit of the line extension options. Does the idea fit with the company and market

Answers

no lo se naday9gxyh87cycu7gg7g

Baby Day Care, a sole proprietorship, wants to pay as many of its obligations as reasonably possible, and be discharged of the rest. To accomplish this goal, the proprietorship should file a petition in bankruptcy under for relief through:_______

a. a liquidation.
b. a reorganization.
c. a repayment plan.
d. an adjustment plan.

Answers

Answer:

b. a reorganization.

Explanation:

Under the chapter 13, the bankruptcy should be filed and it mainly reorganization plan for the payment. It is to be done by splitting the non-secured debt across the various years also it permits the individual to retain the assets

So as per the given situation, in order to attain the goal, the proprietorship should file the petition in bankruptcy under for relief via a reorganization

When a company is operating at capacity and they lose revenue from regular customers by accepting a special order, the loss of revenue is an example of: An unavoidable cost A revenue cost An opportunity cost A sunk cost

Answers

Answer:

An opportunity cost

Explanation:

The opportunity cost is the cost where the loss occurs from the benefit could have been enjoyed in the case when the best alternative choice was selected Since in the question it is mentioned that the company operating at a capacity and than lose revenue from the regular customers so it is an opportunity cost

Gross domestic product understates the total production of final goods and services because of the omission of inflation. intermediate goods. exports. the underground economy.

Answers

Answer:

the underground economy

Explanation:

Gross domestic product is defined as the monetary value of all goods and services that a country produces within a given period.

It is estimated by using income, expenditure, and production in markets.

However GDP does not consider the underground economy.

The underground economy is made up of transactions that are considered illegal or that do not meet up to the reporting requirements of the government.

In effect these are not reported in GDP so GDP is understated.

Which of the following items is an implicit transaction? Recognizing a gain on the sale of equipment Recording payment of monthly interest on loan Recognizing impairment on an intangible asset Recognizing deferred revenue through delivery of goods

Answers

Answer:

The correct answer is the second option: Recording payment of monthly interest on loan.

Explanation:

To begin with, the term known as "implicit transaction" in the field of business management and accounting refers specifically to the situation where the "transaction" was not intended in the first place as a directly situation to get, therefore that it is said to be an opportunity cost that happens when the company uses another resources in order to do another activities. For example the situation where the monthly interest on the loan is paid back to the company.

g If a stock consistently goes down (up) by 1.31% when the market portfolio goes down (up) by 1.05%, then its beta equals:

Answers

Answer:

1.25

Explanation:

The stock consistently goes down by 1.31%

The market portfolio goes up by 1.05%

The beta can be calculated as follows

1.31/1.05

= 1.25

Hence the beta is 1.25

Understand and explain the process of idea generation and validation

Answers

Answer:

Idea generation is the creative process or procedure that a company uses in order to figure out solutions to any number of difficult challenges. It involves coming up with many ideas in a group discussion, selecting the best idea or ideas, working to create a plan to implement the idea, and then actually taking that idea and putting it into practice. The idea can be tangible, something you can touch or see, or intangible, something symbolic or cultural.

Idea validation is the process of testing and validating your idea prior to launching your business name, tagline, product, service or website. This is like the research and development process big companies use to test product ideas before they’re released to the general public.

Idea validation can involve anything from information-gathering interviews to special landing pages on the web. The entire purpose is to expose the idea to your target audience before you build and release the final product.

if potential output declines while actual output remains unchanged, what does the Taylor rule imply that policymakers should do to the fed funds rate

Answers

Answer:

Increased

Explanation:

In the case when there is a fall in the potential output and at the same time the actual output remains the same so here the fund rate should be increased as per the taylor rule as it decrease the output that result in the output gap to fall

So as per the given situation, the fed fund rate should be increased

Hence, the same is to be increased

At the beginning of the year, Sigma Company's balance sheet reported Total Assets of $366,000 and Total Liabilities of $28,300 and Total Paid-in capital of $113,200. During the year, the company reported total revenues of $435,000 and expenses of $336,500. Also, dividends during the year totaled $86,000. Assuming no other changes to Retained earnings, the balance in the Retained earnings account at the end of the year would be:

Answers

Answer:

I don't really know

Explanation:

I have absolutely no clue. good luck.

what is the major difference between money markets and capital markets: One is more domestic while the other is more international

Answers

Answer:

The major difference between money markets and capital markets is:

the time horizon of the debt instruments.

Explanation:

A money market is a global financial market for the exchange of short-term debts (or debt instruments that mature in less than or equal to one year). A capital market is also a global financial market for the exchange of long-term debt instruments (or securities that mature in more than one year).  Additionally, the capital market, unlike the money market, enables the exchange of equity securities (common stocks and preferred stocks).  Principally, the major difference is the time horizon provided by the two markets.

Given the following information, calculate the effective gross income: property: 4 office units, contract rents per unit: $2,750 per month; vacancy and collection losses: 18%; operating expenses: $41,000; capital expenditures: 11%.

Answers

Answer:

the effective gross income is $117,480

Explanation:

The computation of the effective gross income is shown below:

= Gross income - vacancy income

= ($2,750 × 4 units × $12) -  ($2,750 × 12 × 4 × 11%)

= $132,000 - $14,520

= $117,480

hence, the effective gross income is $117,480

The same is to be considered and relevant

In each dropdown next to the following terms, select the identifying letter of its best description. Incurs costs without directly yielding revenues. Provides information used to evaluate the performance of a department. Costs incurred for the joint benefit of more than one department. Costs that a manager has the ability to affect. Holds manager responsible for revenues, costs and investments. Provides information to evaluate the performance of a department manager.

Answers

Answer:

Cost center ⇒  Incurs costs without directly yielding revenues.

Investment center ⇒ Holds manager responsible for revenues, costs and investments.

Departmental accounting system ⇒ Provides information used to evaluate the performance of a department.

Indirect expenses ⇒ Costs incurred for the joint benefit of more than one department.

Controllable Cost ⇒  Costs that a manager has the ability to affect.

Responsibility accounting system ⇒ Provides information to evaluate the performance of a department manager.

- True or False: Professional shoplifters steal primarily for the excitement.

Answers

False, professional shoplifters steal to resell items

What is the present value of a constant perpetuity of 25 per year where the required rate of return is 5%

Answers

Answer:

The present value of a constant perpetuity of 25 per year where the required rate of return is 5% is:

$500

Explanation:

a) Data and Calculations:

A constant perpetuity = $1

Present value factor of a constant perpetuity for 25 per year at 5% is $1/0.002

Number of periods for the perpetuity per year = 25

Required rate of return = 5%

Rate of return per period = 5%/25 = 0.002

Therefore, the value of a constant perpetuity = $1/0.002

= $500

The $500 can be used to multiply any amount given obtain the total value of the perpetuity.

The present value of a constant perpetuity of 25 per year where the required rate of return is 5% is $500

Given the information below :

We know that a constant perpetuity(payments) = $1

Required rate of return = 5%

Rate of return per period = 5%/25 = 0.002

Number of periods for the perpetuity per year = 25

Therefore, the value of a constant perpetuity

= Payments / Rate of return per period

= $1 / 0.002

= $500

Hence, present value of a constant perpetuity of 25 per year where the required rate of return is 5% is $500

Learn more about constant perpetuity here : https://brainly.com/question/17157614

All other things being equal, consumers tend to prefer dollar savings over percentage savings. larger retail outlets over smaller outlets. external reference prices over internal reference prices. percentage savings over dollar savings. smaller retail outlets over larger outlets.

Answers

Answer: larger retail outlets over smaller outlets.

Explanation:

A retail outlet can be refered to as a store or a shop whereby buyers can visit in order to make purchases.

It should be noted that consumers will prefer the larger retail outlets over the smaller outlets. A reason attributed to this is that there are varieties of products that can be chosen by the consumers. Also, the consumers can enjoy discount when they buy in large quantities.

If the reserve requirement was 13% and a bank customer makes a deposit of $440 at the Springfield Bank, the initial result would be: Group of answer choices

Answers

Answer:

O a $382.8 increase in excess reserves and a $57.2 increase in required reserves.

Explanation:

Here is the complete question :

If the reserve requirement was 13% and a bank customer makes a deposit of $440 at the Springfield Bank, the initial result would be:

O a $57.2 increase in excess reserves and a $382.8 increase in required reserves.

O a $382.8 increase in excess reserves and a $57.2 increase in required reserves.

O a $57.2 increase in required reserves and a $2,944.6 increase in excess reserves.

O a $440 increase in required reserves and a $2.944.6 increase in excess reserves.

Reserves is the total amount of a bank's deposit that is not given out as loans

There are two types of reserves

Required reserveExcess reserve

Required reserves is the percentage of deposits required of banks to keep as reserves by the central bank

Required reserves = reserve requirement x deposits

0.13 x $440 =  $57.20

Excess reserves is the difference between reserves and required reserves

$440 - $57.20 = $382.80

You can display good customer service by

Answers

Answer:

Showing good manner, asking if they need anything, and etc...

Explanation:

Answer:

having a professional appearance while attending to costumers.

hope this helps

have a  good day:)

Explanation:

Type the correct answer in the box. Spell all words correctly.


Identify the activities in the receiving step in the supply chain process.

In a supply chain process, the receiving step consists of taking receipt of material and _________ the inventory records

(it's not inspect or requisition**) Giving 15 points

Answers

Answer:

inspect

Explanation:

plato

Answer:

The correct answer is UPDATING

Explanation:

In the article, “Visual Business Intelligence”, Stephen Few claims that visualization analysis and presentation tools are important to a business decision-maker since they _____.
a.
help justify unsound decisions to upper-level management with colorful charts and graphs
b.
help him or her to see through the errors in data collection before making an erroneous decision
c.
assist in viewing the data in even finer detail so that he or she can make the most informed decision possible
d.
allow him or her to view data as an easy to understand image that might be recognized as a pattern and solved without costly data analysis

Answers

Answer:

Explanation:

C

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