Business, 19.04.2021 16:20, ramzieboy13

Direct materials and direct labor are 100% variable. Overhead is 70% fixed. An outside supplier has offered to supply the 70,000 units of RX5 for $20.00 per unit. Required: 1. Determine the total incremental cost of making 70,000 units of RX5. 2. Determine the total incremental cost of buying 70,000 units of RX5. 3. Should the company make or buy RX5

Answers: 2

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answered: trentonmccary2096

Question Completion:

Haver Company currently produces component RX5 for its sole product. The current cost per unit to manufacture the required 70,000 units of RX5 follows.

Direct materials $4.00

Direct labor 8.00

Overhead 9.00

Total costs per unit $21.00

Haver Company

1. The total incremental cost of making 70,000 units of RX5 is:

= $1,029,000.

2. The total incremental cost of buying 70,000 units of RX5 is:

= $1,400,000.

3. The company should make RX5. Buying 70,000 units of RX5 will cost the company $371,000.

Explanation:

a) Data and Calculations:

Variability of costs: 100%

Direct materials $4.00 100% = $4.00

Direct labor 8.00 100% = 8.00

Overhead 9.00 30% = 2.70

Total costs per unit $21.00 $14.70

Fixed cost:

Overhead = $6.30 ($9.00 * 70%)

Offer from an outside supplier to supply 70,000 units of RX5 at $20.00 per unit

Total incremental cost of making 70,000 units of RX5 = $1,029,000 (70,000 * $14.70)

The total incremental cost of buying 70,000 units of RX5 at $20,000 is:

= $1,400,000 (70,000 * $20.00)

Difference = $371,000 ($140,000 - $1,029,000)

answered: Guest

ans.

heterothermic organisms include those organisms that can switch between homeothermic (having body temperature higher than environment) and poikilothermic (having variation in internal body temperature) strategies.

some migratory birds show heterothermy as they decrease their metabolic rate during cold nights to keep their body temperature low. drop in metabolic rate allows increase in production efficiency of birds that reduces the internal body temperature to make it equal to external cold temperature during cold nights.

thus, the correct answer is 'birds allow their temperature drop in order to increase their production efficiency.'

answered: Guest

The business cycle is the periodic but irregular up-and-down movement in economic activity, measured by fluctuations in real gross domestic product (gdp) and other macroeconomic variables. a business cycle is typically characterized by four phases—recession, recovery, growth, and decline—that repeat themselves over time. economists note, however, that complete business cycles vary in length. the duration of business cycles can be anywhere from about two to twelve years, with most cycles averaging six years in length. some business analysts use the business cycle model and terminology to study and explain fluctuations in business inventory and other individual elements of corporate operations. but the term "business cycle" is still primarily associated with larger (industry-wide, regional, national, or even international) business trends.

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Direct materials and direct labor are 100% variable. Overhead is 70% fixed. An outside supplier has...