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Vladimir79 [104]
1 year ago
11

Suppose that the manager of a company has estimated the probability of a super-event sometime during the next five years that wi

ll disrupt all suppliers as 5%, and the probability of a unique-event that would disrupt one of them sometime during the next five years to be 10%. Supplier management costs during this period are $30,000 per supplier. The financial cost incurred if all suppliers are disrupted at the same time is estimated to be $2,000,000. Assume that up to five nearly identical suppliers are available. How many suppliers should the manager use?
Business
1 answer:
Inessa [10]1 year ago
5 0

Based on the financial cost incurred if supply is disrupted and the probability that this happens, the number of suppliers the manager should use is Two (2) suppliers.

<h3>How many suppliers should be used?</h3>

If 3 suppliers are used, the probability of disruption would be:

= Probability of super event + (1 - Probability of super event) x Probability of unique event^ number of suppliers

= 5% + (1 - 5%) x 10%³

= 0.145

The payoff would be:

= 2 million x 0.145 + 30,000

= $191,900

With two suppliers:
= 2 million x (5% + (1 - 5%) x 10%²) + 30,000

= $169,000

With one supplier :

= 2 million x (5% + (1 - 5%) x 10%) + 30,000

= $320,000

The lowest cost is with 2 suppliers so this should be chosen.

Find out more on probability of disruption at brainly.com/question/16625463.

#SPJ1

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Explanation:

An Economies of scope is a  proportionate saving gained by producing two or more distinct goods, when the cost of doing so is less than that of producing each separately.  

Based on the scenario portrayed in the question, the office management firm is hoping to achieve economies of scope.

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3 years ago
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After an impairment loss is recognized, the adjusted carrying amount of the intangible asset shall be its newaccounting basis. W
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A, it is prohibited

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Under the U.S GAAP, subsequent reversal of a previously recognised intangible asset impairment loss is prohibited with the exception that the intangible asset is held up for the purpose of sale.

Cheers.

3 0
3 years ago
Pincus Associates uses the allowance method to account for bad debts. During 2021, its first year of operations, Pincus provided
il63 [147K]

Answer:

What journal entry did Pincus record to write off uncollectible accounts during 2021

In 2021, the company wrote off uncollectible accounts of $10,800.  

Dr Allowance for Uncollectible Accounts $ 10,800

Cr Accounts receivable $ 10,800

and to recognize bad debt expense for 2021?

Pincus estimates that 5% of the accounts receivable balance at 12/31/2021 will prove uncollectible  

Dr Bad Debt Expense $ 1,520

Cr Allowance for Uncollectible Accounts $ 1,520

Explanation:

Pincus provided a total of $268,000 of services on account  

Dr Accounts receivable $ 268,000  

Cr Sales $ 268,000  

In 2021, the company wrote off uncollectible accounts of $10,800.    

Dr Allowance for Uncollectible Accounts $ 10,800  

Cr Accounts receivable $ 10,800  

If the company use the allowance method to account for bad debts, at the moment of the write off the company debits the Allowance for Uncollectible Accounts that was previously estimated with a credit to account receivable, to reflect the new accounts receivable balance.

By the end of 2021, cash collections on accounts receivable totaled $226,800  

Dr CASH $ 226,800  

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BALANCE  

Dr Accounts receivable $ 30,400  

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5 0
3 years ago
Oslo Corporation has two products in its ending inventory, each accounted for at the lower of cost or market. Aprofit margin of
Fantom [35]

Answer:

$20.00 and $32.50

Explanation:

The computation of the ending inventory using the lower of cost or market value which is shown below

For Product 1

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Replacement Cost = $22.50

Net Realizable Value is

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= Net Realizable Value - Profit Margin

= $35 - (0.30 × $40)

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For Product 2

Given that

Replacement Cost = $27

Net Realizable Value is

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Answer:

are making a large purchase.

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As for an average earning person paying instalment is easy, but paying heavy amounts in a go are not, even if someone manages to have those savings, they do not want to spend it all, rather keep them for any discrepancies.

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