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Author Question: Foley Products Company makes a household appliance with model number X500. The goal for 2018 is to ... (Read 65 times)

Wadzanai

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Foley Products Company makes a household appliance with model number X500. The goal for 2018 is to reduce direct materials usage per unit. No defective units are currently produced. Manufacturing conversion costs depend on production capacity defined in terms of X500 units that can be produced. The industry market size for appliances increased 10% from 2017 to 2018. The following additional data are available for 2017 and 2018:

20172018
Units of X500 produced and sold13,00014,300
Selling price$125$120
Direct materials (square feet)38,00036,800
Direct material costs per square foot$14$16
Manufacturing capacity for X500 (units)12,00011,300
Total conversion costs$252,000$237,300
Conversion costs per unit of capacity$21$21

What is operating income for 2018?
◦ $1,716,000
◦ $1,127,200
◦ $889,900
◦ $875,200


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Marked as best answer by Wadzanai on Mar 6, 2021

Dominic

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Wadzanai

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Reply 2 on: Mar 6, 2021
Thanks for the timely response, appreciate it


Dnite

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Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

 

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