Required information
What is the incremental cost incurred if the company increases production and sales from 30,750 to 30,751 units?
3. Assume that Kubin Company produced 30,750 units and expects to sell 30,390 of them. If a new customer unexpectedly emerges
and expresses interest in buying the 360 extra units that have been produced by the company and that would otherwise remain
unsold, what is the incremental manufacturing cost per unit incurred to sell these units to the customer?
4. Assume that Kubin Company produced 30,750 units and expects to sell 30,390 of them. If a new customer unexpectedly emerges
and expresses interest in buying the 360 extra units that have been produced by the company and that would otherwise remain
unsold, what incremental selling and administrative cost per unit is incurred to sell these units to the customer?

Question

23-04-2024
Business

Answered

Required information
What is the incremental cost incurred if the company increases production and sales from 30,750 to 30,751 units?
3. Assume that Kubin Company produced 30,750 units and expects to sell 30,390 of them. If a new customer unexpectedly emerges
and expresses interest in buying the 360 extra units that have been produced by the company and that would otherwise remain
unsold, what is the incremental manufacturing cost per unit incurred to sell these units to the customer?
4. Assume that Kubin Company produced 30,750 units and expects to sell 30,390 of them. If a new customer unexpectedly emerges
and expresses interest in buying the 360 extra units that have been produced by the company and that would otherwise remain
unsold, what incremental selling and administrative cost per unit is incurred to sell these units to the customer?

Answer :

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GinnyAnswer GinnyAnswer · Answer 1 · 2024-04-23T11:15:10-04:00

To calculate the incremental cost incurred when the company increases production and sales from 30,750 to 30,751 units, you need to consider the cost of producing that one additional unit. 1. Incremental manufacturing cost per unit: - This cost includes the additional expenses related to producing one extra unit. - You would need to factor in direct materials, direct labor, and variable overhead costs associated with manufacturing the 360 extra units. - Divide the total incremental manufacturing cost by 360 units to find the incremental manufacturing cost per unit. 2. Incremental selling and administrative cost per unit: - This cost involves the additional expenses related to selling and administrating the 360 extra units. - Consider costs such as additional marketing expenses, sales commissions, and administrative overhead related to these units. - Divide the total incremental selling and administrative cost by 360 units to determine the incremental cost per unit in selling these additional units. By calculating these costs, you can determine the financial impact of increasing production by one unit and selling the excess inventory to the new customer.