S Required information [The following information applies to the questions displayed below.] Ashley Technology Inc. manufactures a scrambling device for cellular telephones. The device's main component is a delicate part, CT140. CT140 is easily damaged and requires careful handling. Once damaged, it must be discarded. The firm hires only skilled laborers to manufacture and install CT140; however, some are still damaged. Robotic instruments process all other parts. Ashley's operating data for 2 years are as follows: Units manufactured Number of CT140 used Number of direct labor hours spent Cost of CT140 per unit $ Direct labor wage rate per $ hour Total productivity 2019 750,000 900,000 150,000 2019 $ 56 $ 2018 156 Assume that fixed manufacturing costs are $50 million in both 2018 and 2019. 2018 1,000,000 1,050,000 200,000 Required: 1. Compute the total productivity ratios for 2018 and 2019. (Round your answers to 4 decimal places.) 135 62

S Required information [The following information applies to the questions displayed below.] Ashley Technology Inc. manufactures a scrambling device for cellular telephones. The device's main component is a delicate part, CT140. CT140 is easily damaged and requires careful handling. Once damaged, it must be discarded. The firm hires only skilled laborers to manufacture and install CT140; however, some are still damaged. Robotic instruments process all other parts. Ashley's operating data for 2 years are as follows: Units manufactured Number of CT140 used Number of direct labor hours spent Cost of CT140 per unit $ Direct labor wage rate per $ hour Total productivity 2019 750,000 900,000 150,000 2019 $ 56 $ 2018 156 Assume that fixed manufacturing costs are $50 million in both 2018 and 2019. 2018 1,000,000 1,050,000 200,000 Required: 1. Compute the total productivity ratios for 2018 and 2019. (Round your answers to 4 decimal places.) 135 62

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter19: Capital Investment

Section: Chapter Questions

Problem 24P

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Required information [The following information applies to the questions displayed below.] Ashley Technology Inc. manufactures a scrambling device for cellular telephones. The device's main component is a delicate part, CT140. CT140 is easily damaged and requires careful handling. Once damaged, it must be discarded. The firm hires only skilled laborers to manufacture and install CT140; however, some are still damaged. Robotic instruments process all other parts. Ashley's operating data for 2 years are as follows: Units manufactured Number of CT140 used. Number of direct labor hours spent Cost of CT140 per unit Direct labor wage rate per hour Direct materials Direct labor 2019 2019 960,000 1,050,000 240,000 per unit per hour $ $ Required: 1. Compute the partial operational productivity for both direct materials and direct labor for each of the 2 years. (Round your answers to 4 decimal places.) 165 $ 65 $ 2018 2018 1,160,000 1,190,000 290,000 per unit per hour 144 71
Required information Skip to question [The following information applies to the questions displayed below.] Ashley Technology Incorporated manufactures a scrambling device for cellular telephones. The device’s main component is a delicate part, CT140. CT140 is easily damaged and requires careful handling. Once damaged, it must be discarded. The firm hires only skilled laborers to manufacture and install CT140; however, some are still damaged. Robotic instruments process all other parts. Ashley’s operating data for 2 years are as follows: 2022 2021 Units manufactured 800,000 1,050,000 Number of CT140 used 910,000 1,060,000 Number of direct labor hours spent 160,000 210,000 Cost of CT140 per unit $ 157 $ 136 Direct labor wage rate per hour $ 57 $ 63 Required: 1. Compute the total productivity ratios for 2021 and 2022. Assume that fixed manufacturing costs are $51 million in both 2021 and 2022. (Round your answers to 4 decimal places.)
Fast Wire Incorporated manufactures a scrambling device for cellular phones. The main component of the scrambling device is a very delicate part-DTV-12. DTV-12 requires careful handlings during manufacturing. Once damaged, the part must be discarded. Only skilled laborers are hired to manufacture and install DTV-12. Damages still occur, however. The following are the operating data of Fast Wire Incorporated for 2021 and 2022 relative to the insertion of DTV-12. Number of phones manufactured Units of DTV-12 used Direct labor hours for DTV-12 insertion Total cost of DTV-12 units Direct labor wage rate per hour The partial direct labor operational productivity ratio for 2021 is: Multiple Choice 262 units per DLH. 169 units per DLH. 428 units per DLH. 300 units per DLH. 333 units per DLH. 2021 600,000 960,000 1,800 $ 1,443,750 $ 67 2022 780,000 1,072,500 2,600 $ 2,333,750 $82
Fast Wire Incorporated manufactures a scrambling device for cellular phones. The main component of the scrambling device is a very delicate part-DTV-12. DTV-12 requires careful handlings during manufacturing. Once damaged, the part must be discarded. Only skilled laborers are hired to manufacture and install DTV-12. Damages still occur, however. The following are the operating data of Fast Wire Incorporated for 2021 and 2022 relative to the insertion of DTV-12. 2021 2022 Number of phones manufactured 600,000 780,000 Units of DTV-12 used 960,000 1,072,500 Direct labor hours for DTV-12 insertion 1,800 2,600 Total cost of DTV-12 units $1,443,750 $2,333,750 Direct labor wage rate per hour $67 $82 The partial operational productivity ratio of DTV-12 in 2022 is:
Ashley Technology Inc. manufactures a scrambling device for cellular telephones. The device's main component is a delicate part, CT140. CT140 is easily damaged and requires careful handling. Once damaged, it must be discarded. The firm hires only skilled laborers to manufacture and install CT140; however, some are still damaged. Robotic instruments process all other parts. Ashley's operating data for 2 years are as follows: Units manufactured Number of CT140 used Number of direct labor hours spent Cost of CT140 per unit Direct labor wage rate per hour 2019 $ S 750,000 900,000 150,000 156 56 2018 1,000,000 1,050,000 200,000 $ 135 $ 62 Assume that fixed manufacturing costs are $50 million in both 2018 and 2019. Required: 1. Compute the total productivity ratios for 2018 and 2019.
An existing robot is used in a commercial material laboratory to handle ceramic samples in the hightemperature environment that is part of several test procedures. Due to changing customer needs, the robot will not meet future service requirements unless it is upgraded at a cost of $2,000. Because of this situation, a new advanced technology robot has been selected for potential replacement of the existing robot. The accompanying estimates have been developed from information provided by some current users of the new robot and data obtained from the manufacturer. The firm’s before-tax MARR is 25% per year. Based on this information,should the existing robot be replaced? Assume that a robot will be needed for an indefinite period.
PKPP Consultants is currently in the process of completing the systems implementation activities for converting RMCO Company’s old system to a new one. Because of unexpected Covid-19 virus and movement control order, Harry, the project manager, is concerned about finishing the project on time. The one remaining activity is testing the new computer system and subsequently eliminating the old one. Harry suggests that they can still meet their completion deadline if they use direct conversion rather than parallel conversion. Required: Assuming that you are the Chief Information System Officer (CIO) of RMCO company, how would you react to Harry’s suggestion? Discuss.
A plastic-manufacturing company owns andoperates a polypropylene production facility that converts the propylene from one of its cracking facilitiesto polypropylene plastics for outside sale. The polypropylene production facility is currently forced tooperate at less than capacity due to an insufficiencyof propylene production capacity in its hydrocarboncracking facility. The chemical engineers are considering alternatives for supplying additional propyleneto the polypropylene production facility. Two feasiblealternatives are to build a pipeline to the nearest outside supply source and to provide additional propylene by truck from an outside source. The engineersalso gathered the following projected cost estimates.• Future costs for purchased propylene excludingdelivery: $0.215 per lb.• Cost of pipeline construction: $200,000 per pipeline mile.• Estimated length of pipeline: 180 miles.• Transportation costs by tank truck: $0.05 per lb,utilizing a common carrier.• Pipeline operating…
Required Information [The following information applies to the questions displayed below.] Travis Metals heats copper ingots to a high temperature by placing them in a large oven. The heated ingots are then run through a shaping machine that forms them into wire. Due to the length of time it takes the oven to heat up, it is never turned off. When the ingots are placed in the oven the temperature is raised to a higher level. Once they are done being heated the oven temperature is turned back down until a new batch of ingots is ready to be heated. The following information shows the ingots processed and the power costs over the past 10 months. Month January February March April May June July August September October Ingots Power Cost 124 104 94 114 144 134 84 74 64 54 $6,060 $5,060 $4,960 $5,560 Total power costs $6,560 $6,160 $4,560 $3,760 $3,960 $2,960 Required: 2. Using the high-low method, estimate a cost formula for power costs. Express the formula in the form Y = a + bx. X 3.…
Required information [The following information applies to the questions displayed below.] Travis Metals heats copper ingots to a high temperature by placing them in a large oven. The heated ingots are then run through a shaping machine that forms them into wire. Due to the length of time it takes the oven to heat up, it is never turned off. When the ingots are placed in the oven the temperature is raised to a higher level. Once they are done being heated the oven temperature is turned back down until a new batch of ingots is ready to be heated. The following information shows the ingots processed and the power costs over the past 10 months. Month January February March April May June July August September October Ingots Power Cost 135 118 108 128 158 148 98 88 78 68 Total power costs $6,620 $5,620 $5,520 56,120 $7,120 $6,720 $5,120 $4,320 $4,520 $3,520 Required: 2. Using the high-low method, estimate a cost formula for power costs. Express the formula in the form Y = a +bX. 3. Predict…
THE DECISION TO LEASE OR BUY AT WARF COMPUTERS Warf Computers has decided to proceed with the manufacture and distribution of the virtual keyboard (VK) the company has developed. To undertake this venture, the company needs to obtain equipment for the production of the microphone for the keyboard. Because of the required sensitivity of the microphone and its small size, the company needs specialized equipment for production. Nick Warf, the company president, has found a vendor for the equipment. Clapton Acoustical Equipment has offered to sell Warf Computers the necessary equipment at a price of $6.1 million. Because of the rapid development of new technology, the equipment falls in the three-year MACRS depreciation class. At the end of four years, the market value of the equipment is expected to be $780,000. Alternatively, the company can lease the equipment from Hendrix Leasing. The lease contract calls for four annual payments of $1.48 million, due at the beginning of the year.…
Quality Chemicals Ltd manufactures a chemical compound which is widely used in industrial cleaning. The compound is made from a small number of chemical products. One of these raw materials, Chemical X, is bought from a supplier in a developing country. Chemical X is scarce and is available from only a few global suppliers. In its untreated form, Chemical X is also toxic and can cause serious damage to the health of individuals who are exposed to it. It is also known that the local environment around factories that produce Chemical X are subject to extensive contamination. A few months ago, Quality Chemicals Ltd renewed a long-term agreement with the supplier for the purchase of Chemical X. Senior management are aware of the health and environmental risks associated with Chemical X, but did not see that these had any relevance to its own business. The toxic effects of the chemical are eliminated by its treatment in the production process that Quality Chemicals uses to make its own…