128 Destion 9: A company has been making to order for a customer, but the customer has since gone into liquidation, and there is no prospect that any money will be obtained from the winding up of the company. Costs incurred to-date in manufacturing the machine are? 60,000 and progress payments of 124.000 have been received from the customer prior to the liquidation. The sales department has found another company willing to buy the machine for 34.000 once it has been manufactured. To complete the work the following costs would be incurred: (a) Material has been bought at a cost of 6,000 and it has no other use. If the machine is not finished, it would be sold as scrap for 3,000.
(b) Further, labor costs would be 8,000. Labour is in short supply, and if the machine not finished, the workforce would be switched to another job, which would team 30,000 in revenue, and incur direct costs of 12,000, not including direct labor, of 8,000 and absorbed (fixed) overhead of 8,000. (c) Consultancy fees is 4,000. If the work is not completed, the consultant's contract would be canceled at a cost of 1,500. Then only other (d) General overheads of 10,000 would be added to the cost of the additional work Net) Should the new customer's offer be accepted? Prepare a statement showing the economize the proposition. Note: Labour cost of 8,000 would be paid if the machine was completed. The labor cost of 8,000 would be paid if we do the job by utilizing such labor and we have to incur material cost 12,000 so the contribution from utilizing such labor in another job would be sale 30,000 – dried material cost 12,000 – direct labor cost 8,000 = 10,000. Absorb fixed overhead are always irrelevant 27. .
Our customer is the center of what we do and thus we offer 100% original essays..
By ordering our essays, you are guaranteed the best quality through our qualified experts.All your information and everything that you do on our website is kept completely confidential.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.Read more
The paper ordered is very original. Orders are checked by the most advanced anti-plagiarism software in the industry which ensures that the the essay written is 100% original. In that regard,we have a zero tolerance policy for plagiarism.Read more
Our Company thrives on excellence and thus we help ensure the Customer’s total satisfaction with the completed Order.To do so, we provide a Free Revision policy as a courtesy service. To receive free revision the Company requires that the Customer provides the request within Fifteen (15) days from the first completion date and within a period of thirty (30) days for dissertations and research papers.Read more
The Company is committed to protect the privacy of the Customer and it will never resell or share any of Customer’s personal information, including credit card data, with any third party. All the online transactions are processed through the secure and reliable online payment systems.Read more
By placing an order with us, you agree to the service we provide. We will endeavor to do all that it takes to deliver a comprehensive paper as per your requirements. We also count on your cooperation to ensure that we deliver on this mandate.Read more