﻿ Why do investors decline to participate in a venture?
, 21.06.2019 23:50, batmanmarie2004

# Why do investors decline to participate in a venture?

### Other questions on the subject: Business

White company has two departments, cutting and finishing. the company uses a job-order costing system and computes a predetermined overhead rate in each department. the cutting department bases its rate on machine-hours, and the finishing department bases its rate on direct labor-hours. at the beginning of the year, the company made the following estimates: department cutting finishing direct labor-hours 6,000 30,000 machine-hours 48,000 5,000 total fixed manufacturing overhead cost \$ 264,000 \$ 366,000 variable manufacturing overhead per machine-hour \$ 2.00 " variable manufacturing overhead per direct labor-hour " \$ 4.00 required: 1. compute the predetermined overhead rate for each department. 2. the job cost sheet for job 203, which was started and completed during the year, showed the following: department cutting finishing direct labor-hours 6 20 machine-hours 80 4 direct materials \$ 500 \$ 310 direct labor cost \$ 108 \$ 360 using the predetermined overhead rates that you computed in requirement (1), compute the total manufacturing cost assigned to job 203. 3. would you expect substantially different amounts of overhead cost to be assigned to some jobs if the company used a plantwide predetermined overhead rate based on direct labor-hours, rather than using departmental rates?
Steele bicycle manufacturing company currently produces the handlebars used in manufacturing its bicycles, which are high-quality racing bikes with limited sales. steele produces and sells only 10,000 bikes each year. due to the low volume of activity, steele is unable to obtain the economies of scale that larger producers achieve. for example, steele could buy the handlebars for \$31 each: they cost \$34 each to make. the following is a detailed breakdown of current production costs: after seeing these figures, steele's president remarked that it would be foolish for the company to continue to produce the handlebars at \$34 each when it can buy them for \$31 each. calculate the total relevant cost. do you agree with the president's conclusion?