Derby inc. manufactures a product which contains a small part. the company has always purchased this motor from a supplier for $125 each. derby recently upgraded its own manufacturing capabilities and now has enough excess capacity (including trained workers) to begin manufacturing the motor instead of buying it. the company prepared the following per unit cost projections of making the motor, assuming that overhead is allocated to the part at the normal predetermined overhead rate of 150% of direct labor cost. direct material $ 38 direct labor 50 overhead (fixed and variable) 75 total $ 163 the required volume of output to produce the motors will not require any incremental fixed overhead. incremental variable overhead cost is $21 per motor. what is the effect on income if derby decides to make the motors?

Kiona co. set up a petty cash fund for payments of small amounts. the following transactions involving the petty cash fund occurred in may (the last month of the company's fiscal year). may 1 prepared a company check for $350 to establish the petty cash fund. 15 prepared a company check to replenish the fund for the following expenditures made since may 1. a. paid $109.20 for janitorial services. b. paid $89.15 for miscellaneous expenses. c. paid postage expenses of $60.90. d. paid $80.01 to the county gazette (the local newspaper) for an advertisement. e. counted $26.84 remaining in the petty cashbox. 16 prepared a company check for $200 to increase the fund to $550. 31 the petty cashier reports that $380.27 cash remains in the fund. a company check is drawn to replenish the fund for the following expenditures made since may 15. f. paid postage expenses of $59.10. g. reimbursed the office manager for business mileage, $47.05. h. paid $48.58 to deliver merchandise to a customer, terms fob destination. 31 the company decides that the may 16 increase in the fund was too large. it reduces the fund by $50, leaving a total of $500.