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3 years ago

Mission Foods produces two flavors of tacos, chicken, and fish, with the following characteristics:

Business

1 answer:

postnew [5]3 years ago

7 0

Answer:

1. $858,000

2. Chicken = 24,000 units and Fish = 36,000 units

Explanation:

The computation is shown below:

1. The anticipated level of profits for the expected sales volumes is

= Expected sales of chicken × (Selling price per taco - Variable cost per taco) + Expected sales of fish × (Selling price per taco - Variable cost per taco) - total fixed cost

= 200,000 × ($3 - $1.50) + 300,000 × ($4.50 - $2.25) - $117,000

= $300,000 + $675,000 - $117,000

= $858,000

2. The break even volume is

Let we assume the sale units be X

So, total units sold for chicken = 40X

And, for the fish it is = 60X

Sale units of chicken × (Selling price per taco - Variable cost per taco) + Sale units of chicken × (Selling price per taco - Variable cost per taco) = Total Fixed cost

0.40X × (3 – 1.50) + 0.60X × (4.50 – 2.25) = $117,000

0.60X + 1.35X = $117,000

1.95X = $117,000

So, the X is 60,000 units

So for chicken it is 60,000 × 40% = 24,000 units

And for fish it is 60,000 × 60% = 36,000 units

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3 years ago

A manager is trying to decide whether to purchase a certain part or to have it produced internally. Internal production could us

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Answer:

For both 10,000 units and 20,000 units, the best alternative is Vendor B

Explanation:

Using the information provided in the question, we can write the following:

Annual Volume of 10,000 units

Internal Alternative 1

Variable costs = 170,000 (we multiply the variable cost per unit by total units)

Fixed costs = 20,000

Total costs = 370,000

Internal Alternative 2

Variable costs = 140,000

Fixed costs = 240,000

Total costs = 380,000

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Vendor B

Total cost = 180,000

Vendor C

Total cost = 190,000

The cheapest option is Vendor B

Now for the 20,000 units:

Internal Alternative 1

Variable costs = 340,000

Fixed costs = 200,000

Total costs = 540,000

Internal Alternative 2

Variable costs = 280,000

Fixed costs = 240,000

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Total cost = 400,000

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Total cost = 360,000

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Total cost = 380,000

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3 years ago

A large bakery buys flour in 25-pound bags. The bakery uses an average of 1,215 bags a year. Preparing an order and receiving a

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Answer and Explanation:

The computation is shown below

a. The economic order quantity is

= sqrt ((2 × annual demand × ordering cost) ÷ carrying cost)

= sqrt ((2 × 1,215 × $10) ÷ $75)

= 18 units

b) Average number of bags on hand is

= EOQ ÷ 2

= 18 ÷ 2

= 9

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= D ÷ EOQ

= 1215 ÷ 18

= 67.5

= 68

d) Total cost = Total carrying cost+ Total ordering cost

= (Q ÷ 2)H +(D ÷ Q)S

= (18 ÷ 2)75 + (1215 ÷ 18) × 10

= 675 + 675

= $1350

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