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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016

M Check your work-Google Chrome O ezto.mheducation.com/hm.tpx value: 4.00 points Unter Components manufactures low-cost navigation systems for installation in ride-sharing cars. It sells these systems to various car services that can customize them for their locale and business model. It manufactures two systems, the Star100 and the Star150, which differ in terms of capabilities. The following information is available Costs per Unit Star100 Star150 Direct materials 75 85 Direct labor 40 Variable overhead 20 25 Fixed overhead 100 130 Total cost per unit 235 290 Price 300 400 Units sold 4,000 2,000 The average wage rate is $25 per hour. Variable overhead waries with the quantity of direct labor-hours. The plant has a capacity of 20,000 direct labor-hours, but current production uses only 10,400 direct labor-hours. Required: a. A nationwide car-sharing service has offered to buy 2,600 Star100 systems and 2.600 Star150 systems if the price is lowered to $210 and $260, respectively, per unit. a-1. If Unter accepts the offer, how many direct labor-hours will be required to produce the additional systems? Answer is complete and correct Direct labor-hours 9.360 a-2. Complete the following table to determine the differential profit increase (or decrease) if Unter accepts this proposal. Prices on regular sales will remain the same. Answer is complete but not entirely correct Differential revenues: Star 100 546,000 676.000 222.000 Star 150 Differential costs: Star 100 Star 150 1,222,000 Differential profit (loss)
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