Home / Questions / Grant Industries a manufacturer of electronic parts has recently received an invitation to...
Grant Industries, a manufacturer of electronic parts, has recently received an invitation to bid on a special order for 23,500 units of one of its most popular products. Grant currently manufactures 47,000 units of this product in its Loveland, Ohio, plant. The plant is operating at 50% capacity. There will be no marketing costs on the special order. The sales manager of Grant wants to set the bid at $11 because she is sure that Grant will get the business at that price. Others on the executive committee of the firm object, saying that Grant would lose money on the special order at that price.
Units |
47,000 |
70,500 |
||
Manufacturing costs: |
||||
Direct materials |
$ |
117,500 |
$ |
176,250 |
Direct labor |
164,500 |
246,750 |
||
Factory overhead |
329,000 |
423,000 |
||
Total manufacturing costs |
$ |
611,000 |
$ |
846,000 |
Unit cost |
$ |
13 |
$ |
12 |
Calculate the relevant costs per unit and the bid price. Relevant Cost per Unit ______________ Bid price should be any price above _____________ |
|
What would the total opportunity cost be if by accepting the special order the company lost sales of 6,500 units to its regular customers? Assume the above facts plus a normal selling price of $24 per unit. Total opportunity cost ____________ |
Jun 19 2020 View more View Less
Computing operating activities cash flow—indirect method The accounting records of CD Sales, Inc. include the following accounts:Compute CO’s net cash provided by (used f...
Apr 21 2020The HR functions are highly interrelated. How would a change in one of the following affect the other HR functions?a. Paying the lowest wages in the industryb. Being reco...
Jul 22 2020What is coca cola's current financial plan? How should the firm meet its financing needs in the current year? How should it balance the benefits of future financing flexi...
Aug 11 2020Box answers > Instructions The following transactions were completed by Daws Company during the current fiscal year ended December 31: Jan. 29 Apr. 18 Aug. 9 Nov. 7 Rece...
Aug 08 2020The figure depicts the market for short-term bonds. Suppose uncertainty about the future will lead investors to move to the short end of the market. (Assume this shock on...
Apr 01 2020Consider the following scenario (adapted from Chapter 5 demand estimation question number 3, p.163): The maker of a leading brand of low-calorie microwavable food estimat...
Apr 13 2020Show that the rate of return on the 3-year zero in the table below also will be 5%.Maturity (years)Yield to Maturity (%)15%26%37%48%
Apr 07 2021Interest Rate: 4% each yearStarting Balance: $120,000Time Passed: 15 yearsRound all answers to the nearest dollar (no cents, no dollar sign, use commas where appropriate)...
Dec 04 2019Estimate the mass fractions of each phase in the composition given below using the lever rule (Use temperature as 750 C at Pb-Sn diagram). Fill in Table2 using the value...
May 16 2020If a firm's total costs are $80 when 10 units of output are produced and $90 when 11 units ofoutput are produced, the marginal cost ofthe 11th unit is Marked out of 1.00 ...
Apr 05 2021