Solution-What is the financial advantage of accepting the

What is the financial advantage of accepting the offer

Assignment Help Managerial Accounting

Reference no: EM133147797

Question - Han Products manufactures 31,000 units of part S-6 each year for use on its production line. At this level of activity, the cost per unit for part S-6 is:

Direct materials $3.50

Direct labor 8.00

Variable manufacturing overhead 2.50

Fixed manufacturing overhead 6.00

Total cost per part $20.00

An outside supplier has offered to sell 31,000 units of part S-6 each year to Han Products for $18 per part. If Han Products accepts this offer, the facilities now being used to manufacture part S-6 could be rented to another company at an annual rental of $81,000. However, Han Products has determined that two-thirds of the fixed manufacturing overhead being applied to part S-6 would continue even if part S-6 were purchased from the outside supplier. What is the financial advantage (disadvantage) of accepting the outside supplier's offer?

Reference no: EM133147797

Questions Cloud

Importance of national-international logistics for business : What is the importance of national and international logistics for a business and the role of the supply chain. Please give an overview of the main factors affe

Explain the cryptocurrency and collection of nfts : Walmart appears to be venturing into the metaverse with plans to create its own cryptocurrency and collection of NFTs. The big-box retailer filed several new tr

Explain the cash conversion cycle : Explain the cash conversion cycle (CCC). Describe the CCC for your employer or company in an industry in which you're interested. What are some specific things

Learned about leadership and vocation : In your first leadership course of the program, LDR-600, you learned about leadership and vocation. One of your readings, "Leadership as a Vocation," has been i

What is the financial advantage of accepting the offer : An outside supplier has offered to sell 31,000 units of part S-6 each year to Han Products for $18 per part. What is financial advantage of accepting the offer

Two days with no phone : Instractions: Theme is the main message, or what a story is mostly about. Supporting details are facts and examples that tell you more about the central idea."

Choosing the right green marketing strategy : Based on the SK Telecom case study and thinking about the article "Choosing the Right Green Marketing Strategy," how green should SK Telecom become?

Describe the different approaches that a company : Describe the different approaches that a company may use when it decides to go international.

What is the firm value in vc round : Jane started her company with her own $100,000. A year later, an angel investor invested $500,000 and got an ownership of 50% for her investment.

User Account

All Pages

What is the financial advantage of accepting the offer

Reference no: EM133147797

Reference no: EM133147797

Questions Cloud

Reviews

Write a Review

Managerial Accounting Questions & Answers

Manage budgets and financial plans

Prepare a retained earnings statement

Prepare a master budget for the three-month period

Construct the companys direct labor budget

Evaluate the predetermined overhead rate

Determine the company''s bid

Compute the pool rates for the different activities

Prepare Company financial statements

Prepare an analysis of terracycles

Discuss the ethical issues

Political resources in emerging markets

Management accounting - ehsan electronics company

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT