A company is considered large if it

Paxton Company can produce a component of its product that incurs the following costs per unit: direct materials, $10.50; direct

Sav [38]

Answer:

$8.50

Explanation:

Computation for the net incremental cost or savings of buying the component.

Using this formula

Incremental cost = Purchase price -Cost savings

Let plug in the formula

$37 - ($10.50+ $14.50 + 3.50)

Incremental cost=$37-$28.5

Incremental cost= $8.50

Therefore the net incremental cost or savings of buying the component is $8.50

3 0

3 years ago

Amy Parker, a 22-year-old and newly hired marine biologist, is quick to admit that she does not plan to keep close tabs on ho

lakkis [162]

Answer:

Final Value= $370,481.13

Explanation:

Giving the following information:

Amy's contribution, plus that of her employer, amounts to $2,150 per year starting at age 23. Amy expects this amount to increase by 3% each year until she retires at the age of 57 (there will be 35 EOY payments). Interest rate= 5%.

<u>First, we will add the growth of the deposits to the interest rate:</u>

Interest rate= 0.03 + 0.05= 0.08

Now, to calculate the final value, we need to use the following formula:

FV= {A*[(1+i)^n-1]}/i

A= annual deposit= 2,150

i= 0.08

n= 35

FV= {2,150*[(1.08^35)-1]}/ 0.08= $370,481.13

6 0

3 years ago

Producers of a strong brand sometimes sell it to dealers only if the dealers will take some or all of the rest of its line. This

never [62]

Answer:

The correct answer is C

Explanation:

Full line forcing is the term which is described as the supplier or the producer which insistence the dealer that must carry the full range of the products in the line.

The policy may or may not be illegal if it could be established that it could serve the legitimate need of the business.

3 0

3 years ago

This problem Set is based on materials covered in modules 1 and 2. It is designed for you to demonstrate your understanding of b

Vilka [71]

Answer:

operating Income = Sales – Variable Costs – Fixed Costs

A CVP analysis is used to determine the sales volume required to achieve a specified profit level. Therefore, the analysis reveals the break-even point where the sales volume yields a net operating income of zero and the sales cutoff amount that generates the first dollar of profit.

Cost-volume profit analysis is an essential tool used to guide managerial, financial and investment decisions.

COST-VOLUME PROFIT ANALYSIS

Contribution Margin and Contribution Margin Percentage

The first step required to perform a CVP analysis is to display the revenue and expense line items in a Contribution Margin Income Statement and compute the Contribution Margin Ratio.

7 0

3 years ago

Now consider the case in which the manufacturer offers a marginal unit quantity discount for the plywood. The first 20,000 squar

Sindrei [870]

Answer:

Explanation:

We can use the following method to solve the given problem

We are given following

Annual demand,

D = 20000*12

D = 240,000 sqft

Fixed order cost, is given as

S = $ 400

Considering the unit cost, is given as

C = $ 1

Holding cost, H = 1*20% = $ 0.2

EOQ = sqrt(2DS/H)

= √(2*240000*400/0.2)

= 30,984 sq ft

This is higher than 20,000 and less than 40,000 sq ft. For this reason, the applicable price for this quantity is $ 0.98

For C = $ 0.98, holding cost, H = 0.98*20% = $ 0.196

Revised EOQ = sqrt(2*240000*400/0.196) = 31,298 sq ft

Total annual cost of EOQ policy = D*C + H*Q/2 + S*D/Q

= 240000*0.98 + 0.196*31298/2 + 400*240000/31298

= $ 241,334.5

Now consider the next level of price, C = $ 0.96

Holding cost, H = 0.96*20% = $ 0.192

EOQ = sqrt(2*240000*400/0.192)

= 31633 sqft

This amount is will not be feasible for this price, because it requires a minimum order of 40000 sqft.

Therefore, Q = 40,000

Total annual cost = 240000*0.96 + 0.192*40000/2 + 400*240000/40000

Total annual cost = $ 236,640

Total annual cost is lowest for order quantity of 40,000 sq ft.

1) Optimal lot size = 40,000 sq ft.

2) the annual cost of this policy

= $ 236,640

3) the cycle inventory of plywood at Prefab = Q/2 = 40000/2

At prefeb= 20,000 sq ft

4) let's assume the manufacturer sells all plywood at $ 0.96, then

Holding cost, H = 0.96*20%

H= $ 0.192

EOQ = sqrt(2*240000*400/0.192)

EOQ = 31633 sqft

Total annual cost = 240000*0.96 + 0.192*31633/2 + 400*240000/31633

Total annual cost = $ 236,471.6

Difference in total annual cost = 236640 - 236471.6 = $ 168.4

4 0

3 years ago