Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. part 2 contains 3 decision making recommendations

Part 2 contains 3 Decision making recommendations that are independent of each other. This part...

90.2K

Verified Solution

Question

Accounting

Part 2 contains 3 Decision making recommendations that are independent of each other. This part covers material in Module 17.
Decision Making #1-Special Order
Omaha Wire produces 2.5-gauge barbed wire that is sold to farm supply companies. Currently the company has capacity to produce 100,000 tons of wire per year.
It is operating at 80% of annual capacity. The cost per ton of wire is as follows:
The average sales price is $900 per ton. The state of Nebraska has approached the company to supply 200 tons for the states prisons for $670 per ton.
Direct material $560
Direct labor $40
Variable Overhead $50
Fixed Overhead 190
Total Cost per ton $840
Required:
If the special order is accepted, calculate the specific change in income for only the special order. Make sure you show your work and explain what the relevant costs are for the special order.
Provide a recommendation to management if the company should accept or reject this special order. Explain in detail your recommendation to management including the change to income that applies to the special order.

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

Q

1) Using accrual accounting, expenses are not recordeduntil the cash for the expense is...

Accounting
Q

Carlsbad Corporation's sales are expected to increase from $5 million in 2016 to $6 million in...

Finance
Q

Please show all work A bottling company uses a filling machine to fill plastic bottles with a...

Statistics
Q

If the interest coverage ratio is too high, then the ROE is too low, Agree or Not...

Finance
Q

Why is working capital a particularly important area of concern for financial managers? At least 200 words.

Finance
Q

A fair 6-sided die is rolled repeatedly. (a) Find the expected number of rolls needed to...

Statistics
Q

Determine if the following function has an inverse function r x x 4x

Calculus
Q

For u 2 5 and v 4 3 find u v u v

Calculus
Q

cal integration command on a graphing calculator Find the future value at 9 75 interest...

Calculus
Q

Green View Farms grows organic produce for the restaurant industry, and has been supplying Sunrise...

Accounting
Q

Average Joes Gym Background You are an Analyst for the professional service firm, BUSI 1043...

Accounting
Q

Make sure and provide the equation for every answer of a cell. Example (=B3+B4)

Accounting