Ruth Company produces 1,000 units of a necessary component with the following costs:
Direct Materials $34,000
Direct Labor 15,000
Variable Overhead 9,000
Fixed Overhead 10,000
Ruth Company could avoid $6,000 in fixed overhead costs if it acquires the components externally. If cost minimization is the major consideration and the company would prefer to buy the components, what is the maximum external price that Ruth Company would accept to acquire the 1,000 units externally?
a) $58,000
b) $59,000
c) $62,000
d) $64,000
$64,000
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Advantages for using the off-the-shelf approach as an EC development strategy include each of the following except:
A) It saves time and money. B) Off-the-shelf applications integrate easily with existing systems. C) The price is usually much lower than the in-house option. D) The company knows what it is getting before it invests in the product.
Paper Clip Company sells office supplies. The following information summarizes the company's operating activities for the year:
Utilities for the store $ 9,500 Sales commissions 10,000 Sales revenue 164,000 Purchases of merchandise 85,000 January 1 inventory 27,000 Rent for store 13,500 December 31 inventory 23,000 What is cost of goods sold? A) $85,000 B) $89,000 C) $108,000 D) $112,000