Apex Company produces artificial Christmas trees. A local shopping mall recently made a special order offer; the shopping mall would like to purchase 200 extra-large white trees. Apex Company is currently producing and selling 20,000 trees; the company has the excess capacity to handle this special order. The shopping mall has offered to pay $120 for each tree. An accountant at Apex Company provides an estimate of the unit product cost as follows:Direct materials $50.00

Direct labor (variable) $3.50

Variable manufacturing overhead $1.00

Fixed manufacturing overhead $4.00

Total unit cost $14.50

This special order would require an investment of $10,000 for the molds required for the extra-large trees. These molds would have no other purpose and would have no salvage value. The special order trees would also have an additional variable cost of $6.00 per unit associated with having a white tree. This special order would not have any effect on the company's other sales.

Should Apex accept the order? What is the effect on net operating income of accepting the order?

Answers

Answer 1

Answer:

Answer:

It is profitable to accept the special offer.

Explanation:

Giving the following information:

The shopping mall would like to purchase 200 extra-large white trees. Apex Company has the excess capacity to handle this special order. The shopping mall has offered to pay $120 for each tree.

Variable costs:

Direct materials $50.00

Direct labor (variable) $3.50

Variable manufacturing overhead $1.00

Additional variable cost= $6

This special order would require an investment of $10,000 for the molds required for the extra-large trees.

Because it is a special offer and there is unused capacity, we will not have into account the fixed costs (except the incremental fixed cost).

Unitary variable cost= 50 + 3.5 + 1 + 6= $60.5

Fixed costs= 10,000

Incremental income= (200*120) - (200*60.5) - 10,000= $1,900

It is profitable to accept the special offer.

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Shen has plans to go to an opera and already has a $100 nonrefundable, nonexchangeable, and nontransferable ticket. Now Valerie, whom Shen has wanted to date for a long time, asks him to a party. Shen would prefer to go to the party with Valerie and forgo the opera, but he doesn't want to waste the $100 he spent on the opera ticket. From the perspective of an economist, if Van decides to go to the party with Amy, what has he just done?1. Incorrectly allowed a sunk cost to influence his decision2. Made a choice that was not optimal3 Correctly ignored a sunk cost

The Precision Widget Company had the following balances in their accounts at the end of the accounting period: Work-in-Process $ 5,000 Finished Goods 20,000 Cost of Goods Sold 200,000 If their manufacturing overhead was overallocated by $8,000 and Precision Widget adjusts their accounts using a proration based on total ending balances, the revised ending balance for Cost of Goods Sold would be

Answers

Answer:

$192,880

Explanation:

We need to determine the balances for each of the items.

Work in process =(5,000/225,000*100) × 8,000

= 2.2% × 8,000

= 176

Finished goods = (20,000/225,000 *100) × 8,000

= 8.9% × 8,000

= 712

Cost of goods sold = (200,000/225,000 *100) × 8,000

= 88.9% × 8,000

= 7,120

Therefore, the revised ending balance for COGS would be ;

= 200,000 - 7,120

= $192,880

On January 1, a store had inventory of $48,000. January purchases were $46,000 and January sales were $90,000. On February 1 a fire destroyed most of the inventory. The rate of gross profit was 25% of cost. Merchandise with a selling price of $7,500 remained undamaged after the fire. Compute the amount of the fire loss, assuming the store had no insurance coverage. Label all figures.

Answers

Answer:

the amount of the fire loss is $16,000

Explanation:

The computation of the amount of the fire loss is shown below

January 1 inventory $48,000

Add purchases $46,000

Goods Available $94,000

Less Cost of Goods Sold ($90,000 × 100 ÷ 125) $72,000

Less Cost of undamaged goods ($7,500 × 100 ÷ 125) $6,000

Goods Lost by Fire $16,000

hence, the amount of the fire loss is $16,000

In October 1, 2019, Westfield, Inc. sold machinery to a customer for $ 25 comma 000. The customer could not pay at the time of sale, but agreed to pay 12 months later, and signed a 12minusmonth note at 11% interest. How much interest revenue was earned during 2019? Round any intermediate calculations to two decimal places, and your final answer to the nearest dollar.

Answers

Answer:

Interest revenue for the year 2019 = $688

Explanation:

Total cost of asset = $25,000

Interest Revenue to be earned = 11% for 12 months

Total interest revenue = $25,000 X 11% = $2750

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Answers

Answer:

The correct answer is letter "B": Economies of agglomeration; corresponding diseconomies.

Explanation:

Economies of agglomeration refer to a type of economy in which companies are located one close to another to take advantage of their core competencies. This economic structure typically helps businesses to reduce relocation and delivery costs increasing their profits but in some other cases, the costs could increase if some of the firms lost their economies of scale.

Thus, metropolises in the U.S. must find ways to boost the benefit of economies of agglomeration minimizing the negative effects of the diseconomies of scale in which some firms might fall.

If a customer values good A at $15, and it costs the firm $10 to produce, current profit per unit is

Answers

Answer:

Explanation:

15 - 10 = 5

The workers at State Hospital, a public sector employer, and Acme Inc, a private employer, are subject to speech censorship and arbitrary job termination. Constitutional issues are present only for the State Hospital workers.TrueFalse

Answers

Answer:

Explanation:

The State Hospital is owned and supervised directly by the state government, whereas, the organization named Acme Inc, is privately owned.

In a state-owned entity, the state government is the authority that has the final say which is based on the Constitution.
Hence, the arbitration done in the state hospital issues would also include Constitutional issues.
Whereas, the same would not be the case with the privately owned organization.

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