FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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- Acadia Logistics anticipates that it will need more distribu-tion center space to accommodate what it believes will bea significant increase in demand for its final-mile services.Acadia could either lease public warehouse space to coverall levels of demand or construct its own distribution centerto meet a specified level of demand, and then use publicwarehousing to cover the rest. The yearly cost of buildingand operating its own facility, including the amortized costof construction, is $12.00 per square foot. The yearly cost ofleasing public warehouse space is $20.00 per square foot. Theexpected demand requirements follow: a. Calculate the expected value of leasing public warehousespace as required by demand.b. Calculate the expected value of building a 200,000-square-foot distribution center and leasing public warehousespace as required if demand exceeds the need for 200,000square feet of space.c. Calculate the expected value of building a 300,000-square-foot distribution center and…arrow_forwardThe constraint at Pickrel Corporation is time on a particular machine. The company makes three products that use this machine. Data concerning those products appear below: Selling price per unit Variable cost per unit Minutes on the constraint Multiple Choice O Assume that sufficient time is available on the constrained machine to satisfy demand for all but the least profitable product. Up to how much should the company be willing to pay to acquire more of this constrained resource? (Round your intermediate calculations to 2 decimal places.) O $27.36 per unit $15.60 per minute $13.10 per minute VD $ 344.85 $ 270.18 5.70 $104.52 per unit JT $ 415.40 $310.88 6.70 SM $ 119.32 $ 91.96 1.90arrow_forwardplease give me an accurate answer please for allarrow_forward
- The operations manager at Sebago Manufacturing is considering three proposals for supplying a critical component for its new line of electric watercraft. Proposal one is to purchase the component, proposal two is make the component in-house using rebuilt equipment, and proposal three is to purchase new, highly automated equipment. The costs associated with each proposal are provided in the table below. Proposal Annual cost ofcapital required Variable cost ofeach component One: purchase $0.00 $22.00 Two: make with rebuiltequipment $150,000.00 $14.00 Three: make with newequipment $450,000.00 $12.50 At what quantity range will each option be preferred?arrow_forwardRahularrow_forwardwho has an average wage of $48,890 per year. In addition, the equipment will have operating and energy costs of $12, 190 per year. Determine the average rate of return on the equipment, giving effect to straight-line depreciation on the investment. If required, round to the nearest whole percent. % Maui Fabricators Inc. is considering an investment in equipment that will replace direct labor. The equipment has a cost of $126,000 with a $11,000 residual value and a 5-year life. The equipment will replace one employee who has an average wage of $48,890 per year. In addition, the equipment will have operating and energy costs of $12,190 per year. Determine the average rate of return on the equipment, giving effect to straight-line depreciation on the investment. If required, round to the nearest whole percent. %arrow_forward
- Thomas Consultants provided Bran Construction with assistance in implementing various cost-savings initiatives. Thomas’s contract specifies that it will receive a flat fee of $70,000 and an additional $40,000 if Bran reaches a prespecified target amount of cost savings. Thomas estimates that there is a 30% chance that Bran will achieve the cost-savings target. Required: Assuming Thomas uses the expected value as its estimate of variable consideration, calculate the transaction price. Assuming Thomas uses the most likely value as its estimate of variable consideration, calculate the transaction price. Assume Thomas uses the expected value as its estimate of variable consideration, but is very uncertain of that estimate due to a lack of experience with similar consulting arrangements. Calculate the transaction price.arrow_forwardThomas Consultants provided Bran Construction with assistance in implementing various cost-savings initiatives. Thomas's contract specifies that it will receive a flat fee of $56,000 and an additional $26,000 if Bran reaches a prespecified target amount of cost savings. Thomas estimates that there is a 20% chance that Bran will achieve the cost-savings target. Required: 1. Assuming Thomas uses the expected value as its estimate of variable consideration, calculate the transaction price. 2. Assuming Thomas uses the most likely value as its estimate of variable consideration, calculate the transaction price. 3. Assume Thomas uses the expected value as its estimate of variable consideration, but is very uncertain of that estimate due to a lack of experience with similar consulting arrangements. Calculate the transaction price. Complete this question by entering your answers in the tabs below. Req 1 Req 2 and 3 2. Assuming Thomas uses the most likely value as its estimate of variable…arrow_forwardanalysis Your program office has just completed of the latest Contract Performance Report on its Cost Plus Fixed Fee contract with Truman Inc. The original estimated cost of the contract is $300 million and the fixed fee is $15 million. The following information is available: "Best Case" EAC = $295 million "Most Likely" EAC = $310 million "Worst Case" EAC = $348 million Which one of the following represents the best estimate of the funding requirements for the Truman Inc. contract?arrow_forward
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