Norgaard Corporation Makes 8,000 Units of Part G25 Each Year

question 35

Multiple Choice

Norgaard Corporation makes 8,000 units of part G25 each year. This part is used in one of the company's products. The company's Accounting Department reports the following costs of producing the part at this level of activity: An outside supplier has offered to make and sell the part to the company for $21.20 each. If this offer is accepted, the supervisor's salary and all of the variable costs, including direct labor, can be avoided. The special equipment used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represents fixed costs of the entire company. If the outside supplier's offer were accepted, only $2,000 of these allocated general overhead costs would be avoided. In addition, the space used to produce part G25 would be used to make more of one of the company's other products, generating an additional segment margin of $16,000 per year for that product.
The annual financial advantage (disadvantage) for the company as a result of buying part G25 from the outside supplier should be:

• A) ($8,400)
• B) $16,000
• C) ($8,000)
• D) ($40,000)

Identify the conditions under which sample means are considered consistent, efficient, or unbiased estimators of population means.

Apply estimation principles to calculate estimators for population parameters from sample data.

Understand the implications of sampling error on the reliability of point estimates.

Assess the limitations and potential biases in various sampling and polling methods.

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Definitions:

Seventeenth Century

The period from 1601 to 1700, marked by significant developments in various fields such as science, politics, and exploration.

North American

Refers to anything related to the continent that comprises the northern part of America, including Canada, the United States, Mexico, and Greenland.

Virginia Company

The Virginia Company was a joint-stock company chartered by King James I of England in the early 17th century with the purpose of establishing settlements on the coast of North America.

Headright System

A land grant policy that provided settlers a certain amount of land for each indentured servant they transported to America, primarily used in the colonial period.