Maurice Tutor

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About Maurice Tutor

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Teaching Since: May 2017
Last Sign in: 402 Weeks Ago, 2 Days Ago
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Education

  • MCS,PHD
    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

Experience

  • Professor
    Phoniex University
    Oct-2001 - Nov-2016

Category > Accounting Posted 04 Aug 2017 My Price 9.00

MotoCar Corporation

Internal or External Acquisitions:
No Opportunity Costs
The Van Division of MotoCar Corporation has offered to purchase 180,000 wheels from the Wheel Division for $42 per wheel. At a normal volume of 500,000 wheels per year, production costs per wheel for the Wheel Division are as follows:

Direct materials $15
Direct labor 10
Variable overhead 5
Fixed overhead 19
Total $49

 

The Wheel Division has been selling 500,000 wheels per year to outside buyers at $59 each. Capacity is 700,000 wheels per year. The Van Division has been buying wheels from outside suppliers at $55 per wheel.

(a) Calculate the net benefit (or cost) to the Wheel Division of accepting the offer from the Van Division.

$___per wheel

(b) Calculate the net benefit (or cost) to Motocar Corp. if the Wheel Division accepts the offer from the Van Division.
$___ per wheel

Answers

Maurice Tutor
(5)
Status NEW Posted 04 Aug 2017 10:08 PM My Price 9.00

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