Here is the synopsis of our sample research paper on Selling the Machine. Have the paper e-mailed to you 24/7/365.
Essay / Research Paper Abstract
A 5 page paper assessing opportunities that a manufacturer has in selling a special-order machine it constructed for a company that cannot take delivery. That company has paid a ten percent deposit that it has forfeited, but the manufacturer has identified three approaches it can take to selling the machine. The paper determines the value of each alternative and discusses the role that fixed manufacturing-overhead cost should play in arriving at a price for a special order. Bibliography lists 1 source.
Page Count:
5 pages (~225 words per page)
File: CC6_KSacctSellMach.rtf
Buy This Term Paper »
Unformatted sample text from the term paper:
Jay Company. Just as Miami completed the machine, Jay Co. declared bankruptcy, defaulted on the order, and forfeited the 10% deposit paid on the selling price of $72,500.
Miamis manufacturing manager identified the costs already incurred in the production of the special machinery for Jay Co. as follows: Direct Material $16,600 Direct Labor $21,400 Manufacturing Overhead Applied: Variable $10,700 Fixed $5350 $16,050
Fixed S&A costs $5405 Total $59,455 less 7,250 deposit = $52,205 net production cost. 1. Determine the dollar contribution each of the three
alternatives will add to Miamis before tax profit. Alternative 1: Kaytell Corp. Kaytell will buy the machinery as a special order for
$68,400 if Miami reworks it to Kaytells specifications. Kaytell will pay when it takes delivery in two months; Miami will need a month to rework the machine with additional
costs of $10,400. Because this is being classified as a special order, Miami also will need to pay a 3 percent commission on
the purchase price of $68,400. Kaytell intends to pay the balance immediately upon delivery, qualifying it for a 2 percent discount for paying within 10 days.
Alternative 2: Convert to standard model. If Miami converts the completed machine to a standard model, it can sell the reworked machine for $62,500.
Miamis costs of conversion total $6,150. There is no specific information given as to whether Miami can expect the purchaser of this conversion
will take the 2/10 option, but most of Miamis customers do take advantage of that discount. It will be assumed that the purchaser of the conversion model will take
...