User Account

All Pages

What is the cost saving from purchasing parts

Assignment Help Accounting Basics
Reference no: EM131806861

Question - Drayton Company manufactures equipment used by construction companies. It currently produces a product with 30 parts, but redesign has reduced the number of parts to 9. The current activity capacity and demand for the 30 part configuration and the expected demand for the redesigned 9 part configuration are provided below:

Activities Activity driver Activity capacity Current activity demand Expected activity demand

Materials usage Number of parts 300,000 300,000 90,000

Assembly Direct labor hours 20,000 20,000 6,000

Purchasing parts Number of orders 20,000 16,000 8,000

Materials usage has a rate of $5 per part and no fixed costs. Assembly has a rate of $20 per labor hour with no fixed component. Purchasing requires clerks who can process 5,000 purchase orders. Each clerk earns $40,000 per year. There is also a $1 per order processing cost.

What is the cost saving from purchasing parts?

Reference no: EM131806861

Questions Cloud

Determining the annual demand for widgets : The annual demand for widgets has been determined to be 10,000 per year. Each widget sells for $4.00 and costs $2.25 to produce.
Year cumulative savings : We suggest that the spreadsheet include at least columns for the year, the year's salary, the year's deposit, and the year's cumulative savings.
Identify the clients key problems and issues : Write a 2,800- to 3,500-word paper using the Clinical Case Study Guidelines document to prepare your analysis of the video presented in class.
Determine the equivalent taxable yield : Determine the equivalent taxable yield, Which bond will give the client more profit after taxes
What is the cost saving from purchasing parts : Drayton Company manufactures equipment used by construction companies. What is the cost saving from purchasing parts
Dicsuss the influence the decision-making process had : Dicsuss the influence the decision-making process had to the outcome. Evaluate the effectiveness of the process. What stages were most challenging and why?
What is the firm paying for the flexibility : The construction firm of Cathy Strong & Daughters can purchase some construction equipment for $100K. After 5 years, it will have a salvage value of $15K.
What is the saving in materials usage cost : Materials usage has a rate of $5 per part and no fixed costs. What is the saving in materials usage cost with the new design changes
How the population conceptualizes mental illness : Reflect on which other historical events may have had a lasting impact on these populations and how these events had a lasting impact.

Reviews

Write a Review

Accounting Basics Questions & Answers

  On may 1 company reacquired 2000 shares of its own 2 par

on may 1 company reacquired 2000 shares of its own 2 par value stock for 100000 cash. on june 30 800 of the treasury

  What do you understand by harmonisation

ACCT 304 Accounting Theory Assessment. What do you understand by harmonisation as opposed to standardisation in relation to financial accounting

  Due to erratic sales of its sole product- a disposable

due to erratic sales of its sole product- a disposable pocket camera-markline compnay has been experiencing difficulty

  Abc s-corporation had 200000 of ordinary income in 2013 abe

abc s-corporation had 200000 of ordinary income in 2013 abe an 80 owner contributes white machine in an irc section 351

  Whichof the given choice has the lower present value

On July 1, 2011, Jackson Company exercises a $5,000 call option (plus par value) on its outstanding bonds that have a carrying value of $208,000.

  Farm labs inc provides mad cow disease testing for both

farm labs inc. provides mad cow disease testing for both state and federal governmental agricultural agencies. because

  Rayac is about to go public its stcokholders own 50000

rayac is about to go public. its stcokholders own 50000 shares. the new public issue will represent 700000 shares. the

  Daren has investments in two passive activities activity a

daren has investments in two passive activities. activity a acquired three years ago produces income in the current

  In a perpetual inventory system the merchandise inventory

1. a company had expenses other than cost of goods sold of 262000. determine sales and gross profit given cost of goods

  What amount goes into len''s book capital account

The property has a FMV of $100,000 and a basis of $60,000. What amount goes into Len's book capital account? Lens tax capital account

  Weighted-average method in its process costing system

Hobart Beverage Company uses the weighted-average method in its process costing system. Materials are included at the start of the production process but conversion costs are uniformly applied throughout the production process.

  Sec and european equivalent views of gaap

The SEC and its European equivalent are trying to merge their respective views of GAAP (Generally Accepted Accounting Principles). What are the easy points and what are the stumbling blocks?

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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