How much is the savings amount for your chosen alternative if the firm is earning 7% return on its capital

Q: Assume that HASF  furniture Inc., as described, currently purchases the chair cushions for its lawn…

A: The companies make their make or buy decisions based on comparative analysis of total costs incurred…

Q: A firm is trying to decide between two location alternatives, Albany and Baltimore. Albany would…

A: Particulars Alternative A ($) Alternative B ($) Sales @ 9,000 units 450,000 432,000 Less: Labor…

Q: A company is considering a project with a breakeven point of 18,000 units. The selling price is $22…

A: Formula:

Q: A producer of microwave ovens has adopted an experience curve pricing approach for its new model.…

A: As per the learning curve or experience curve theory, the cost of producing an item reduces as and…

Q: Assume that a manufacturer can purchase a needed component from a supplier at a cost of $9.50 per…

A: Make or buy decision needs to be made by the management when an item can either be purchased from…

Q: Sloan Transmissions, Inc., has the following estimates for its new gear assembly project: price =…

A: Variable cost refers to the cost that varies with the production. If production is high then the…

Q: How much will profit decrease by?

A: Introduction Contribution is calculated by Deducting Variable Cost from Sales. When Fixed Cost is…

Q: A firm has fixed costs of $200,000 associated with the manufacture of lawn mowers that cost $120 per…

A: Solution: Cost Volume Profit (CVP) Analysis describes how changes in costs, expenses and Volume…

Q: company can buy the part from an outside supplier for​ $2 per unit and avoid​ 20% of the fixed…

A:

Q: Shocking Electronics uses a standard part to make different types of radios. The total cost to make…

A: Working note: Fixed cost incurred if parts outsource Total fixed cost = $40000 $40000*80%=  $32000

Q: Mary Williams, owner of Williams Products, is evaluatingwhether to introduce a new product line.…

A: “Since you have asked multiple questions, we will solve the first three questions for you. If you…

Q: One company makes watches and delivers t

A: The point of equilibrium means the breakeven point. It is the number of units sold where the company…

Q: Jersey Ltd uses target costing and has designed a new machine that is estimated to sell on the…

A: Target cost = Estimated selling - Estimated gross profit

Q: The MBF factory has a total cost of 45,000 units if it produces 500 products, and a total cost of…

A: Fixed costs are the costs that a company has to bear regardless of how much revenue it gathers.…

Q: Compuware, Ltd., produces digital-to-analog converters for compact disk players used by radio…

A: Lets understand the basics. Break even point is a point at which no profit no loss condition arise.…

Q: A small firm intends to increase the capacity of a bottleneck operation by adding a new machine. Two…

A: a) The computation of break-even point is as follows: Hence the break even point for alternative A…

Q: Kien Sneakers is interested in investigating the level of contribution to profits and overheads that…

A:

Q: 2. The operations manager for an auto supply company is evaluating the potential purchase of a new…

A: Break-even point: The break-even point refers to a point where the total cost is equal to the total…

Q: A company has a process that results in 14000 pounds of Product A that can be sold for $8 per pound.…

A: Sales value if sold now = 14,000 x 8 = 112,000   Increase in sales value if processed further =…

Q: Gelb Company currently manufactures 46,500 units per year of a key component for its manufacturing…

A: Formula: Total Variable cost = Variable cost per unit x number of units Number of units to be…

Q: You want to start a firm whose output you believe you can sell for $25 per unit. The operation will…

A: Given information: Fixed costs amounted to $130,000 Selling price per unit is $25 Variable cost per…

Q: Your Company produces 1,000 parts per year, which are used in the assembly of one of its products.…

A: The decision regarding whether to buy the product from the market or to make the product depends…

Q: Perry, Inc. manufactures metal stampings for automobiles: stick shifts and trim kits. Fixed costs…

A: Contribution margin per unit = Sales per unit - Variable cost per unit   Break-even point in…

Q: In a manufacturing casting factory, a new machine is needed for casting machines. There are two…

A: The first step is to calculate the net cash flows from the given information and then computing the…

Q: 4. Konica Minolta plans to sell a copier that prints documents on both sides simultaneously, cutting…

A: Internal rate of return(IRR): It is the discount rate  where  the net present value  of a project…

Q: One machine has to be purchased to produce a certain product. Two options are available. Machine A,…

A: 1) Machine A   Purchase Cost = 900,000 Production per hour = 50 units Variable cost per Hour = $40…

Q: A manager must decide how many machines of a certain type to purchase. Each machine can process 100…

A: a) One machine: Fixed cost= $2,100 variable cost= $17 per customer, revenue = $45 per customer…

Q: A firm produces products X, Y and Z with contribution margins of $4, $5 and $10 respectively. The…

A: Workings: Given values: Machine hours available = 5000 Contribution margin for x = 4…

Q: The first task: It was decided to establish a factory to produce building . units from sustainable…

A: "Since you have posted a question with multiple sub parts, we will solve first three sub parts for…

Q: Kent Co. manufactures a product that sells for $50.00 and has variable costs of $24.00 per unit.…

A: Contribution margin = Sales - Variable cost

Q: Voltaic Electronics uses a standard part in the manufacture of different types of radios. The total…

A: Fixed cost remain fixed whatever may be the level of output where as variable cost will vary with…

Q: use either of two processes.  One would entail a variable cost of P17 per unit and an annual fixed…

A: A B C D E F 1. Internal 1           2.  Fixed cost 200,000         3. Variable cost 17…

Q: Venus Robotics can produce 25,000 robots a year on its daytime shift. The fixed manufacturing costs…

A: The unit manufacturing cost is the cost incurred in production one unit of output. It can be…

Q: The Borstal Company has to choose between two machines that do the same job but have different…

A: The concept of the time value of money states that the current worth of money is more than its value…

Q: Goldberg Company currently manufactures 52,000 units per year of a key component for its…

A: Introduction Incremental cost: Incremental cost is the additional cost incurred by the company if it…

Q: he Gargus Company, which manufactures projection equipment, is ready to introduce a new line of…

A: solution : concept : when a company follows absorption costing it means the company has a policy of…

Q: An electronics firm is currently manufacturing anitem that has a va riable cost of $.50 per unit and…

A: We first need to determine the profit in the two cases by considering the revenue and the total…

Q: The Borstal Company has to choose between two machines that do the same job but have different…

A: Machine A initial cost =40000 discount rate =6% Present value FACTOR =1-(1+r)^-n/r  Present value…

Q: Diamond and Turf Inc. is considering an investment in one of two machines. The sewing machine will…

A: Annual net cash flows (Sewing Machine) = (342-190)*$0.36*1400 hour = $76,608 Annual net cash flows…

Q: A Company wants to introduce new product. The estimated price of each mobile phone is RO 60. The…

A: Answer) Calculation of Target Cost Target Cost = Selling price – Profit margin…

Q: Chile’s, Inc. currently produces and sells 4,000 units of a product that has a contribution margin…

A: We know that under marginal costing  Profit = Sales Revenue - Total Variable cost - Total Fixed…

Q: A company can sell all the units it can produce of either Product A or Product B but not both.…

A: Product A Product B contribution margin PER UNIT $16 $30 divide by: machine hours required per…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.