Calculate the economic profit and relevent cost, Cost Accounting

Assignment Help:

A. Bolero Industries Ltd. has been approached by a customer who would like a special job to be done for her, and is willing to pay $60,000 for it. The job would require the following materials.

1746_Untitled.png

i) Material B is used regularly by Bolero, and would need to be replaced to meet other production demands.

ii) Materials C and D are in stock due to previous over-buying, and have restricted use. Bolero has no other use for material C, but the units of material D could be used in another job as a substitute for 300 units of material E, which currently costs $15 per unit (of which the company has no units in stock at the moment).

iii) Should Bolero take the job? Which costs are relevant? Explain the reason you included/excluded each cost. Calculate the economic profit associated with job. Interpret this number in terms of Bolero's opportunities.


Related Discussions:- Calculate the economic profit and relevent cost

Match the item below by entering the appropriate code letter, Match the ite...

Match the items below by entering the appropriate code letter A. Controller B. Deficit C. Payout Ratio D. Stock Dividend E. Declaration Date F. Preemptive right G. Par Value H. L

Prepare the bank reconciliation statement, As the Junior Bank Clerk of a bu...

As the Junior Bank Clerk of a business, one of your monthly tasks is to prepare the bank reconciliation statement. At the month ending 31 January 2012, the bank statement has be

Labour Costs and Overhead Costs, Labour Costs and Overhead costs Labo...

Labour Costs and Overhead costs Labour Costs Labour costs can be indirect or direct labour costs. Direct labour cost refers to wages paid to workers who such are directly

Irrelevant cost., what is irrelevant cost and give example

what is irrelevant cost and give example

Estimate finished goods cost of goods sold , ln an attempt to conceal a the...

ln an attempt to conceal a thefi of funds, Kaito Kid, controller of Shinichi Products, lnc. placed a bomb in the company s record vault. The ensuing explosion left only fragments o

Preparation of cash flow statement, To begin with, we require two successiv...

To begin with, we require two successive balance sheets and the operating statement or loss and profit account relating the two balance sheets. There are two ways wherein this s

Wages department, Wages Department It is accountable for the preparati...

Wages Department It is accountable for the preparation of the payroll and the payment of wages. The routine will need: a) Analysis of clock cards and verify of overtime aut

Prepare a properly classified cash flow statement, Prepare a properly class...

Prepare a properly classified Cash Flow Statement for Sports Enterprises Ltd for the year ended 31st December 2011. Note that the Closing Cash at Bank Balance at 31st December 2011

Ms, Goga Ltd is busy building a five-star hotel in the area, they use the p...

Goga Ltd is busy building a five-star hotel in the area, they use the percentage of completion method to determine profits and would like to calculate the profit for the year. dra

Process costing procedure, Process Costing Procedure 1. The production...

Process Costing Procedure 1. The production factory is divided into a number of methods. 2. An account is maintained and opened for every process. 3. Every process accou

Write Your Message!

Captcha
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