Ahsan company makes 60,000 units per year of a part it uses in the products it manufactures. the unit product cost of this part is computed as follows:
direct $10.60
direct 15.20
variable manufacturing 2.10
fixed manufacturing 12.60
unit product $40.50
an outside supplier has offered to sell the company all of these parts it needs for $45.70 a unit. if the company accepts this offer, the facilities now being used to make the part could be used to make more units of a product that is in high demand. the additional contribution margin on this other product would be $318,000 per year.
if the part were purchased from the outside supplier, all of the direct labor cost of the part would be avoided. however, $3.50 of the fixed manufacturing overhead cost being applied to the part would continue even if the part were purchased from the outside supplier. this fixed manufacturing overhead cost would be applied to the company's remaining products.
how much of the unit product cost of $40.50 is relevant in the decision of whether to make or buy the part?
a. $40.50
b. $15.20
c. $27.90
d. $37.00
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Ответ:
option D
Explanation:
given,
Direct Materials $10.60
Direct Labor 15.20
Variable Manufacturing Overhead 2.10
Fixed Manufacturing Overhead 12.60
Unit Product Cost $40.50
Relevant unit product cost of 40.5 is
= direct material + direct labour + variable manufacturing overhead + avoidable fixed overhead
= 10.6 + 15.2 + 2.1 + (12.6 - 3.5)
= $37
Hence, the correct answer is option D
Ответ:
The Correct Answer is D
Explanation:
Difference between a Service charge and a Finance charge are discussed below:
Service Charge: A service charge is usually an additional cost charged by the service provider on the top of your bills and these providers are such as hotels and restaurants.
The most common purpose of the Service charge is to contribute to a service employee's wages.
Finance Charge: The Cost of credit expressed as a dollar amount. this is the amount charged to the purchaser by the lender for use of money.