please answer questions 3,4,5 in clear steps. 3. Bradley Toys produces giant stu
ID: 2542168 • Letter: P
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please answer questions 3,4,5 in clear steps.
3. Bradley Toys produces giant stuffed bears. Each bear consists of $13 of variable costs and $9 of fixed costs and sells for $45. A wholesaler offers to buy 8,500 bears from Bradley at $18 each, of which Bradley has the capacity to produce. If Bradley accepts this special order, Bradley will incur extra shipping costs of $2 per bear. Determine the incremental income or loss that Bradley Toys would realize by accepting the special order 4. Darby Dairy has four product lines: Sour Cream, Ice Cream, Yogurt, and Butter. Information related to the company's four product lines is illustrated below for the month of June: Sour Cream Ice Cream YORurt ButterTotal Units sold 2,000 500 400 200 3,100 Revenue Variable costs Contribution Margin Fixed costs Net income (loss) $10,000 $20,000 10,000 $20,000 $60,000 48001 (28,0001 $5,800 $15,200 $32,000 (3,000) 7,0001 9,0001 sa000) s.00 s 2.800 s 8.200 $13,000 6,000] $4,000 IZ,0001 13,000 $7,000 2.0001 Darby is considering dropping the Sour Cream product line. Prepare an incremental analysis to show the effect of dropping this product line. Based on your analysis, should the Sour Cream product line be retained or eliminated, and what is the amount of incremental net income or net loss that would result from eliminating the product line? Marlow Manufacturing is considering the replacement of a piece of equipment with a newer model. The following data has been collected 5. Old Equipment $225,000 90,000 300,000 New Equipment $375,000 Purchase price Accumulated depreciation Annual operating costs 240,000 If the old equipment is replaced now, it can be sold for $60,000. Both the old equipment's remaining useful life and the new equipment's useful life is 5 years, Prepare an analysis to determine the incremental net income or (loss) that would result from replacing the old equipment.Explanation / Answer
3. Calculation of Incremenatal Income or Loss Particular Unit/Rate Total Selling Price Offered by Wholesaler $18 $153,000 Variable Cost -$13 -$110,500 Additional Shipping Cost, if accepting the Proposal -$2 -$17,000 Incremental Income $3 $25,500 As stated in problem, that Bradley has the capacity to produce additional order for 8500 Bear offered by wholesaler. Hence, Fixed cost will be treated as sunk cost and only relevnt cost to considered, to calculate Incremental Income/Loss Note: As per Chegg policy solution for only first question will be provided, in case of various seperate question.
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