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Bad White [126]
3 years ago
8

TufStuff, Inc., sells a wide range of drums, bins, boxes, and other containers that are used in the chemical industry. One of th

e company’s products is a heavy-duty corrosion-resistant metal drum, called the WVD drum, used to store toxic wastes. Production is constrained by the capacity of an automated welding machine that is used to make precision welds. A total of 2,300 hours of welding time is available annually on the machine. Because each drum requires 0.8 hours of welding machine time, annual production is limited to 2,875 drums. At present, the welding machine is used exclusively to make the WVD drums. The accounting department has provided the following financial data concerning the WVD drums:
WVD Drums
Selling price per drum $ 175.00
Cost per drum:
Direct materials $45.40
Direct labor ($18 per hour) 4.50
Manufacturing overhead 4.05
Selling and administrative expense 16.30 70.25
Margin per drum $ 104.75
Management believes 3,375 WVD drums could be sold each year if the company had sufficient manufacturing capacity. As an alternative to adding another welding machine, management has considered buying additional drums from an outside supplier. Harcor Industries, Inc., a supplier of quality products, would be able to provide up to 1,800 WVD-type drums per year at a price of $130 per drum, which TufStuff would resell to its customers at its normal selling price after appropriate relabeling.
Business
1 answer:
kozerog [31]3 years ago
5 0

Answer:

It is more convenient to produce in house. But, the best option would be to produce 2,875 units and buy the rest of 3,375 demand.

Explanation:

Giving the following information:

Cost per drum:

Direct materials $45.40

Direct labor ($18 per hour) 4.50

Manufacturing overhead 4.05

Selling and administrative expense 16.30 70.25

Margin per drum $ 104.75

Management believes 3,375 WVD drums could be sold each year if the company had sufficient manufacturing capacity.

Harcor Industries, Inc., a supplier of quality products, would be able to provide up to 1,800 WVD-type drums per year for $130 per drum.

We will assume that the selling cost will remain whether it is purchased or make in house.

Make in house:

Unitary cost= 45.40 + 4.5 + 4.05 + 70.25= $124.2

Buy= $130

Gross profit (make in house)= 175 - 124.2 - 16.3= 34.5

Gross profit (buy)= 175 - 130 - 16.3= 28.7

It is more convenient to produce in house. But, the best option would be to produce 2,875 units and buy the rest of 3,375 demand.

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New Body, a gym, bought new exercise equipment on credit. The purchase price was $10,438.88. They secure the loan with a financi
LiRa [457]

Answer:

b. $524.94

Explanation:

We need to solve for the PTM of a 6 year annuity with quarterly payment discount for 6.25% compounding quarterly as well:

PV \div \frac{1-(1+r)^{-time} }{rate} = PTM\\

PV $10,438.8800

time 24 (6 years x 4 quarter per year)

rate 0.015625 8 ( 0.0625 / 4 )

The payment every quarter will be for:

10438.88 \div \frac{1-(1+0.015625)^{-24} }{0.015625} = PTM\\

PTM  $ 524.942

4 0
2 years ago
During the past five years, the nation of Andolvia began a massive undertaking: teaching farmers how to successfully grow and ha
kykrilka [37]

Answer:

The correct option is C,import quotas.

Explanation:

Import quota is an approach to prevent home industries from high foreign competition by placing a ceiling on the quantity of locally manufactured goods that can be imported.

By import quotas,the businesses are provided a level playing ground to thrive as they able to sell their products at reasonable prices and not chased out of business by foreign manufacturers that produce in large quantity at reduced cost in order to sell at a very competitive price.

7 0
2 years ago
Read 2 more answers
A manufacturer is contemplating a switch from buying to producing a certain item. Setup cost would be the same as ordering cost.
Flauer [41]

Answer

D) compared to the EOQ, the maximum inventory would be approx 30% lower.

Explanation

EOQ = √(2*Co*D/Cc)

EPQ= √ (2*Co*D/(Cc*(1-x)))

x=D/P

D = demand rate

P =production rate

Co=ordering cost

Cc=holding cost

1) The production rate would be about double the usage rate.

hence, P = 2D

x=D/2D=0.5

EPQ= √ (2*Co*D/((1-0.5)*Cc))

EPQ= √ (2*Co*D/0.5Cc)

EPQ=√ (1/0.5)*EOQ

EPQ=√ (2)*EOQ

EPQ=1.41*EOQ

Hence, EPQ is around 40% larger than EOQ.

Ans.: c) EPQ will be approximately 40% larger than the EOQ.

2) Compared to the EOQ, the maximum inventory would be

maximum inventory = Q

EPQ = 1.41 EOQ

EPQ = 1.41*Q

Q=EPQ/1.41

Q=0.71 EPQ

Hence, compared to EOQ, maximum inventory in EPQ is only 70% of that in EOQ model.

4 0
3 years ago
The first step in the market research process is to define the objectives and research needs. what was nike’s primary objective
Alika [10]
<span>The first step in the market research process is to define the objectives and research needs. Nike's primary objective in conducting this research was that Nike wanted to understand its female customers.
The objectives that Nike set for their company was to understand better the women that buy their products. Thus, they conducted a research in order to do so, so as to see what drives their female customers to buy their shoes and other equipment and then tailor their products to their needs even more.
</span>
6 0
3 years ago
Colgate-Palmolive Company has just paid an annual dividend of . Analysts are predicting dividends to grow by per year over the n
denis23 [38]

The amount of $97.85 is the price that​ dividend-discount model predict that Colgate stock should sell for​ today

<u>Given Information</u>

Current dividend (D0) = $1.59

   

Dividend payments for next five years includes:

D1 = 1.59 +0.18

D1 = 1.77

   

D2 = 1.77 +0.18

D2 = 1.95

D3 = 1.95 +0.18

D3 = 2.13

D4 = 2.13 +0.18

D4 =2.31

D5 = 2.31 +0.18

D5 =2.49

Year  Cash Flow         PVF at 8.1%        Present value

1            1.77                0.92506938        1.637372803    

2           1.95                0.855753358      1.668719048

3           2.13                0.791631229        1.686174517    

4           2.31                0.73231381           1.691644901    

5           2.49               0.677441082        <u>1.686828295</u>

Present value of Dividends                   <u>8.3707</u>

PV of remaining dividends in 5 year = D5 x (1+g)/(Ke-g))      

PV of remaining dividends in 5 year = 2.49(1+0.061)/(0.081-0.061)    

PV of remaining dividends in 5 year = $132.0945

Given that g=6.1%, ke=8.1%      

PV of remaining dividends in year = 0 = PV of the remaining dividends in year 5* 1/(1+0.081)^5

= 132.0945 * 1/(1+0.081)^5    

= $89.48624      

As per dividend-discount model, Colgate stock should sell for​ today = PV of Dividends till 5th year + PV of Remaining Dividend at t=0

= $89.48624 + $8.3707    

= $97.8531

= $97.85

Hence, the amount of $97.85 is the price that​ dividend-discount model predict that Colgate stock should sell for​ today.

Read more about dividend

<em>brainly.com/question/3161471</em>

8 0
2 years ago
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