Flox Hill Consulting Has Its Own Printing Department with the Following

question 130

Multiple Choice

Flox Hill Consulting has its own printing department with the following annual costs: Supplies $400,000
Labor 300,000
Overhead 200,000
Total $900,000
The managers would like to outsource the printing function because it is not considered a core competency. The overhead is 60% fixed. Of the fixed overhead, $60,000 is the salary of the printing department director. The remaining overhead is an allocation of overhead costs for the entire consulting firm. The department director would still oversee the printing activities and coordinate all of the printing activities for the organization with the outside printing vendor. The maximum amount that Flox Hill is willing to pay an outside firm to replace the printing services is:

• A)$820,000
• B)$900,000
• C)$700,000
• D)$840,000

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Definitions:

Anterior Pituitary Cell

A type of cell located in the anterior lobe of the pituitary gland, responsible for producing and releasing hormones that regulate various bodily functions.

Steroid Hormones

Steroid hormones are a class of hormones derived from cholesterol that act as chemical messengers in the body, including sex hormones and corticosteroids.

Plasma Membrane

The lipid bilayer membrane that surrounds a cell, controlling the movement of substances in and out of the cell.

Lipid Soluble

A characteristic of substances that can dissolve in fats, oils, and non-polar solvents, allowing them to pass easily through cell membranes.