Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. question below? thanks coursherotranscribedtext: q

Question below? thanks CoursHeroTranscribedText: Question.7 > Herman Limited makes a product, P. It sells for...

50.1K

Verified Solution

Question

Accounting

Question below? thanks

image
CoursHeroTranscribedText: Question.7 > Herman Limited makes a product, P. It sells for $55 each. The sales budget for Year X . shows that the company expects to sell 4,000 units of P. > The manufacturing cost per unit for the product in Year.X is expected to be: > $ Materials 35.00 Conversion cost 17.76 52.76 + The product is made in one cost centre, the conversion cost rate per hour being $14.80. The cost center budget for Year X is: 3 Variable costs $ Operating labour 74,400 Other costs 18,000 Fixed costs Two supervisors 30,000 Other costs 55,200 177,600 These budgets reflect the normal annual sales of P and of other products made in this . cost centre. If the utilization of the cost centre falls to 60% on a regular basis, then one supervisor could be made redundant. A small.local company, Ferris Limited, has. offered to manufacture product P for $47 each. > Required: > Prepare calculations to show whether P should be manufactured or purchased. > - - (20 marks) >

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students