2.3. R econsider the Wyndor Glass Co. case study introduced in Section 2.1. Suppose that Bill Tasto (Wyndor's vice president for manufacturing) now has found a way to provide a little • ⚫ additional production time in Plant 2 to the new products. a. Use the graphical method to find the new optimal solution and the resulting total profit if one additional hour per week is provided. Production Time Used for Each Unit Produced Plant 1 2 Doors 1 hour 3 3 hours Unit profit $300 Windows 0 2 hours 2 hours $500 Available per Week 4 hours 12 hours 18 hours

Current Attempt in Progress Nancy is helping her company consider a change in its CVP relationship to increase profitability. Currently, the company is selling 14,200 units, generating $78,700 in operating income. The contribution margin is $29 per unit, while total variable costs are $298,200. What amount of fixed costs does the company currently incur? Fixed costs $ If it increases its selling price by 10% while expecting volume to drop by just 5%, will the company achieve its goal? New operating income $ The company ✓ its goal.

Exercise 3   The Bremer Co. manufactures cordless telephones Bremer is planning to implement a JIT production system, which requires annual tooling costs of $150,000. Bremer estimates that the following annual benefits would arise from JIT production.   a. Average inventory will decline by $700,000 from $900,000 to $200,00 b. Insurance, space, materials handling, and setup costs, which currently total $200,00 would decline by 30% c. The emphasis on quality inherent in JIT system would reduce rework costs by 20% Bremer currently incurs $350,000 on rework. d. Better quality would eneble Bremer to raise the prices of its products by $3 per unit. Bremer sells $30,000 unit each year. Bremer required rate of return on inventory investment is 12% per year   Required: Claculate the net benefit or cost to the Bremer Corporation From implementing a JIT production system. What other nonfinancial and qualitative factors should Brmeer Consider before deciding on whether it should implement a JIT…

Question 2 Kosova Itd is a new formed firm which intends to penetrate in the international market. The newly formed firm produces car radios, which currently it sells to car manufacturers for £60 each. Next year the business plans to make and sell 20,000 radios. The business's costs are as follows: Manufacturing Variable materials £20 per radio £14 per radio £12 per radio Variable labour Other variable costs Fixed cost £80,000 per year Administration and selling Variable £3 per radio £60,000 per year Fixed Required: (a) Calculate the break-even point for next year, expressed both in quantity of radios and sales value. (b) Calculate the operating leverage for next year, and discuss why operating leverage is useful. value.