Chapter 13 cont - Bus 215 Section 8 Homework Assignment Chapter 13 cont E13-1 Case 1 Item a Sales revenue b Direct materials c Direct labor d

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Bus 215 Section 8 November 22, 2010 Homework Assignment: Chapter 13 cont. E13-1) Case 1 Case 2 Item Relevan t Not Relevan t Relevan t Not Rel eva nt a. Sales revenue X X b. Direct materials X X c. Direct labor X X d. Variable manufacturing overhead X X e. Depreciation - model B100 machine X X f. Book value - Model B100 machine X X g. Disposal value - modeal B100 machine X X h. Market value - Modeal B300 machine (cost) X X i. Fixed manufacturing overhead (general) X X j. Variable selling expense X X k. Fixed selling expense X X l. General administrative overhead X X E13-3) 1. Because it costs $90,000 less to make the carburetors internally than to buy them from the outside supplier, Troy Engines Ltd. should reject the outside supplier’s offer. Total Relevant Costs - 15,000 Units Item Make Buy Direct Materials (15,000 units x $14) 210,000 Direct Labor (15,000 units x $10) 150,000 Variable manufacturing overhead 45,000 Fixed manufacturing overhead, traceable (one- thirds x $90,000) 30,000 (two-thirds x $90,000) Fixed manufacturing overead,
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This note was uploaded on 01/06/2012 for the course BUSINESS 215 taught by Professor Patriciamcquaid during the Fall '10 term at Cal Poly.

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Chapter 13 cont - Bus 215 Section 8 Homework Assignment Chapter 13 cont E13-1 Case 1 Item a Sales revenue b Direct materials c Direct labor d

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