Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. talboe company makes wheels which it uses in the p

Talboe Company makes wheels which it uses in the production of children's wagons. Talboe's costs...

70.2K

Verified Solution

Question

Accounting

Talboe Company makes wheels which it uses in the production of children's wagons. Talboe's costs to produce 170,000 wheels annually are as follows:
Direct material $ 34,000
Direct labor 51,000
Variable manufacturing overhead 25,500
Fixed manufacturing overhead
65,000
Total
$175,500
An outside supplier has offered to sell Talboe similar wheels for $0.80 per wheel. If the wheels are purchased from the outside supplier, $20,000 of annual fixed manufacturing overhead would be avoided and the facilities now being used to make the wheels would be rented to another company for $49,700 per year.
What is the highest price that Talboe could pay the outside supplier for each wheel and still be economically indifferent between making or buying the wheels? (Round your answer to 2 decimal places.)

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

33. Which of the following is the correct calculation of the premium over conversion value? a.      market price...

Finance
Q

Let Y 1 ,...,Y n be a sample from the density f(y) = λ 2 ye...

Statistics
Q

You may have heard that ice skaters actually skate on a thin layer of water rather...

Chemistry
Q

A   three-phase,   460-V,   60-Hz,   six-pole   Y-connected   induction   motor   has   Rs = 0.32 Ω, R′ r = 0.18 Ω,...

Electrical Engineering
Q

Pineapple Motor Company manufactures two types of specialty electric motors, a commercial motor and a residential...

Accounting
Q

tudy the following diagram Which of the following would NOT complete the diagram correctly Lacked...

Biology
Q

How do the people in the town consider Mr Dimmesdale I According to people Mr...

Biology
Q

If the stand-alone method were used, what amount of cost would be allocated to Burger...

Basic Math
Q

The diameter of a circle is 14 m. Find its area to the nearest tenth.

Basic Math
Q

In a statement of cash flows, which of the following would be classified as an...

Accounting
Q

4 The following information was taken from the accounts of Green Market, a delicatessen, at...

Accounting
Q

Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc...

Accounting