Calculate the net benefit

Assignment Help Accounting Basics
Reference no: EM13311354

Outsourcing (Make-or-Buy) Decision
Assume a division of Hewlett-Packard currently makes 12,000 circuit boards per year used in producing diagnostic electronic instruments at a cost of $34 per board, consisting of variable costs per unit of $24 and fixed costs per unit of $10. Further assume Sanmina-SCI offers to sell Hewlett-Packard the 12,000 circuit boards for $34 each. If Hewlett-Packard accepts this offer, the facilities currently used to make the boards could be rented to one of Hewlett-Packard's suppliers for $46,000 per year. In addition, $6 per unit of the fixed overhead applied to the circuit boards would be totally eliminated.

Calculate the net benefit (cost) to HP of outsourcing the component from Samina-SCI.

Reference no: EM13311354

Questions Cloud

Explain what is the concentration of the oh : The Ksp of Ca(OH)2 is 5.5x10^-5. What is the concentration of the OH^- (aq) when in a saturated solution of Ca(OH)2 (aq)
The adjusting entry for accrued fees : The adjusting entry for accrued fees was omitted at October 31, the end of the current year.
What is the force acting on the ball : As a baseball is being caught, its speed goes from 31 to 0 m/s in 0.005 seconds. The mass of the baseball is 0.145 kg. What is the force acting on the ball
Explain what is the value of (delta)h : Consider a gas in a 1.0 L bulb at stp that is connected via a valve to another bulb that is initially evacuated. Answer the following concerning what occurs when the valve between the two bulbs is opened.
Calculate the net benefit : Calculate the net benefit (cost) to HP of outsourcing the component from Samina-SCI.
Determine the net force on the motorcycle : A motorcycle and rider have a total mass of 289 kg the rider applies the brakes, What is the net force (in Newtons) on the motorcycle and rider combination
How far has the plane traveled in that amount of time : If an airplane accelerates at 10 m/s2 for 12.3 seconds. How far has the plane traveled in that amount of time
Explain what was the temperature of the sample after heating : The root-mean-square (rms) speed of a sample of molecules was found to be 1.8*10^3 m/s at 25.0 degrees C. After heating, the rms speed was found to be 4.6*10^3 m/s. What was the temperature of the sample after heating
What is the buoyant force on the chamber : An undersea research chamber for aquanauts is spherical with an external diameter of 7.93 m. The mass of the chamber, when occupied, is 64800 kg. What is the buoyant force on the chamber

Reviews

Write a Review

Accounting Basics Questions & Answers

  Depreciation under the straight-line method

Assuming that the compressor has a salvage value of $2,500, calculate its 2008 depreciation under the straight-line method

  Tax consequences of the liquidation

In a liquidation subject to section 332, Rose distributes assets to Pheasant and Crystal in accordance with their ownership interests. Discuss the tax consequences of the liquidation for Rose, Pheasant, and Crystal.

  Evaluate calculation of adjusted basis for rose stock

Evaluate Nancy's calculation of the adjusted basis for her Rose stock. How would your answer change if Nancy purchased thereplacement stock on July 15 rather than on May 31?

  What will be the accounting entry

A machine costing Rs. 10.0 million and having book value of Rs. 6.5 million was traded-in with another machine having a fair market value of Rs. 7.0 million with an additional cash payment of Rs. 1.0 million. what will be the accounting entry?

  Strategies for testing internal controls

Briefly describe three strategies for testing internal controls when information technology is used for significant accounting processing.

  What is neary capital balance after kansas investment

The capital balance for Bolcar is $110,000 and for Neary is $40,000. These two partners share profits and losses 70 percent (Bolcar) and 30 percent (Neary). Kansas invests $50,000 in cash into the partnership for a 30 percent ownership. The bonus ..

  Primary reasons for price controls

What are the primary reasons for a country to sometimes withhold goods or put price controls on exports to international markets? What are possible outcomes of this practice? What are your feelings about price controls?

  Annual market rate at the date of issuance

Sears issues bonds with a par value of $138,000 on January 1, 2009. The bond' annual contract rate is 8%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance..

  What problems would result in the next accounting period

1. From the information given, record closing entries. 2. If closing entries were not prepared at the end of the accounting period, what problems would result in the next accounting period?

  How much interest expense will be recognized in 2012

A company issues $15,000,000, 7.8%, 20-year bonds to yield 8% on January 1, 2012. Interest is paid on June 30 and December 31. The proceeds from the bonds are $14,703,109. Using effective-interest amortization, how much interest expense will be re..

  Equivalent units for conversion costs

Fabert Corp uses the weighted-average method in its process costing system. The Assembly Department started the month with 16,000 units in its beginning work in process inventory that were 40% completed with respect to conversion costs.

  What is the total amount of cash expected to be received

Cash sales are 30% of total sales and all credit sales are expected to be collected in the month after the sale. What is the total amount of cash expected to be received from customers in May?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd