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Calculating the number of calenders that should be ordered

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The J&B Card Shop sells calendars depicting a different Colonial scene each month. The once-a-year order for each year's calendar arrives in September. From past experience, the September to July demand for the calendars can be approximated by a normal probability distribution with r=500 and o=120. The calendars cost $1.50 each, and J&B sells them for $3 each.

a. If J&B throws out all unsold calendars at the end of July (i.e., salvage value is zero), how many calendars should be ordered?
b. If J&B reduces the calendar price to $1 at the end of July and can sell all surplus calendars at this price, how many calendars should be ordered?

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a. If J&B throws out all unsold calendars at the end of July (i.e., salvage value is zero), how many calendars should be ordered?

Cost, c=$1.50
Selling price,p=$3.00
Salvage value, s=$0
Cost of overage=Co=c-s=1.50-0=$1.50
Cost of ...

Solution Summary

Solution determines the number of calenders that should be ordered in the given cases.

$2.19
See Also This Related BrainMass Solution

Summit Company: Direct Labor Cost; Bus Company: Cost of Goods Sold

Question 14:

Summit Company has provided the following inventory balances and manufacturing cost data for the month of January:

Inventories January 1 January 31
Direct materials $26,000 $36,000
Work in process $24,000 $29,000
Finished goods $68,000 $53,000

Month of January
Cost of goods manufactured $597,000
Manufacturing overhead applied $140,000
Direct materials used $180,000
Actual manufacturing overhead $152,000

Under Summit's job-order costing system, any over or underapplied overhead is closed to the Cost of Goods Sold account at the end of the calendar year (i.e., December 31).

How much direct labor cost was incurred during January?

$282,000

$288,000

$272,000

$277,000

Question 15:

The Bus Company uses a job-order costing system. The following information was recorded for September:

Cost Added During September
Job Number September 1 Inventory Direct Materials Direct Labor
1 $1,450 $280 $210
2 $1,850 $230 $310
3 $900 $1,700 $160
4 $1,150 $4,700 $410

The direct labor wage rate is $10 per hour. Overhead is applied at the rate of $5 per direct labor-hour. Jobs 1, 2, and 3 have been completed and transferred to finished goods. Job 2 has been delivered to the customer.

The Cost of Goods Sold for September (before disposition of any underapplied or overapplied overhead) is:

$2,395
$4,145
$2,545
$6,370

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