Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,020 remotes is as follows: Direct materials Direct labor Variable overhead Fixed overhead Total Cost $ 65, 130 $ 55,110 $ 30,060 $ 50,100 $ 200,400 Frannie is approached by Lincoln Company, which offers to make the remotes for $18 per unit. Required: 1. Compute the difference in cost per unit between making and buying the remotes if none of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 2. Compute the difference in cost per unit between making and buying the remotes if $20,040 of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 3. What is the change in net income if fixed cost of $20,040 can be avoided and Frannie could rent out the factory space no longer in use for $20,040?

Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,020 remotes is as follows: Direct materials Direct labor Variable overhead Fixed overhead Total Cost $ 65, 130 $ 55,110 $ 30,060 $ 50,100 $ 200,400 Frannie is approached by Lincoln Company, which offers to make the remotes for $18 per unit. Required: 1. Compute the difference in cost per unit between making and buying the remotes if none of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 2. Compute the difference in cost per unit between making and buying the remotes if $20,040 of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 3. What is the change in net income if fixed cost of $20,040 can be avoided and Frannie could rent out the factory space no longer in use for $20,040?

Name: Frannie Fans currently manufactures ceiling fans that include remotes
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Description: Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,020remotes is as follows:Direct materialsDirect laborVariable overheadFixed overheadTotalFrannie is approached by Lincoln Compa

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 1PA: The following product Costs are available for Haworth Company on the production of chairs: direct...

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Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,320 remotes is as follows: Direct materials Direct labor Variable overhead Fixed overhead Total Cost $ 67,080 $ 56,760 $ 30,960 $ 51,600 $ 206,400 Frannie is approached by Lincoln Company, which offers to make the remotes for $18 per unit. Required: 1. Compute the difference in cost per unit between making and buying the remotes if none of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 2. Compute the difference in cost per unit between making and buying the remotes if $20,640 of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 3. What is the change in net income if fixed cost of $20,640 can be avoided and Frannie could rent out the factory space no longer in use for $20,640?
Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,340 remotes is as follows: Direct materials Direct labor Variable overhead Fixed overhead Total Cost $ 67,210 $ 56,870 $ 31,020 $ 51,700 $ 206,800 Frannie is approached by Lincoln Company, which offers to make the remotes for $18 per unit. Required: 1. Compute the difference in cost per unit between making and buying the remotes if none of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 2. Compute the difference in cost per unit between making and buying the remotes if $20,680 of the fixed costs can be avoided. What is the change in net income, if Frannie Fans buys the remotes? 3. What is the change in net income if fixed cost of $20,680 can be avoided and Frannie could rent out the factory space no longer in use for $20,680? Complete this question by entering your answers in the tabs below. Required 1 Required 2…
Frannie Fans currently manufactures ceiling fans that include remotes to operate them. The current cost to manufacture 10,040 remotes is as follows: Cost Direct materials 65, 260 55, 220 $ Direct labor Variable overhead 30,120 $ Fixed overhead 50, 200 $ 200,800 Total Frannie is approached by Lincoln Company which offers to make the remotes for $18 per unit. Required: 1. Compute the difference in cost between making and buying the remotes if none of the fixed costs can be avoided. What is the change in net income? 2. Compute the difference in cost between making and buying the remotes if $20,080 of the fixed costs can be avoided. What is the change in net income? 3. What is the change in net income if fixed cost of $20,080 can be avoided and Frannie could rent out the factory space no longer in use for $20,080?
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