Case Study Trans European Plastics

1. For financial accounting purposes, what is the total amount of product costs incurred to make 10,000 units?

2. It can be determined that it will take approximately 20,126 hours at a cost of $20,121.71, with the given labor rate of $1.08 per hour, for the 4 month production run, with the breakdown of each month as below:

In, 8 hours a day, the company can produce 60 * 8 * (1/0.5) = 960 shirts, which is the current production capacity. But it needs to produce only 800 shirts.

4. What inventory method is used to value inventories? Does this method reflect current cost at year-end?

330-10-30330-10-30-1 The primary basis of accounting for inventories is cost, which has been defined generally as the price paid or consideration given to acquire an asset. As applied to inventories, cost means in principle the sum of the applicable expenditures and charges directly or indirectly incurred in bringing an article to its existing condition and location. It is understood to mean acquisition and production cost, and its determination involves many considerations. 330-10-30330-10-30-2 Although principles for the determination of inventory costs may be easily stated, their application, particularly to such inventory items as work in process and finished goods, is difficult because of the variety of considerations in the allocation of costs and charges.

Each year there is an increase in demands for plastic bags, and therefore more are shipped, creating further environmental pollution concerns. This increase in demand has lead to the phenomenal upsurge in the use and misuse of plastic bags globally, both in developed and developing countries. Statistics show that 4 to 5 trillion plastic bags are produced per annum, whereby North America and Western Europe account for nearly 80% (Geographical, 2005; Reusable Bags, 2005). Cheeseman (2007) states that approximately “380 billion plastic shopping bags are used in the United States annually”; in turn, only 0.6% of this is recycled.

We prefer the EOQ/ ROP system as gains from reducing the order/ production size (gains in terms of less value of inventory being produced) which though lead to increase in setup cost far outweigh the gains from Blanchard’s current system (gains in terms of reduction of setup cost) while, costs are that of the value of inventory being produced.

EOQ as described everywhere is “the order quantity that minimizes total inventory holding costs and ordering costs. It is one of the oldest classical production scheduling models”. This model uses the following assumptions:

5. How would you go about deciding the appropriate batch size for the Stonehaven factory? What factors would you consider? How do they interrelate? (You may wish to do some calculations, but concentrate on thinking conceptually.)

Australians approximately use 6.9 billion plastic bags per year (Errata Nolan ITU, 2002). The high consumption of plastic bags highlights one outstanding issue. The adverse impact, consumption and disposal of plastic bags have towards the environment. This involves the resources used to make

I have taken it upon myself to test two inventory management systems and have found a system that will yield the least cost to Parts Emporium Inc. The two systems I have tested are the Continuous Inventory System and the Periodic Inventory System. Using data that I have gathered from the products DB032 and the EG151, I have compiled calculations and have concluded a continuous inventory system would be best for our corporation. Attached you will find said calculations; I would like to take this moment and present the continuous inventory system and recognize all of the relevant costs. The following is an explanation of each calculation under the continuous inventory system:

Production in factories is carried out in batches, where each batch is an integer number of drums set by you. The cost to produce one batch equals $1500 plus the number of drums in the batch times $1000. For example, the cost to produce a batch of 10 drums is $1500 + (10)$1000 = $11,500.

* Production capacity is 10,000 units a year however they hope to construct a $45 million facility with a capacity of

First, we need to calculate employee’s working time per year, employees work for 42-2=40 hours per 5-day week. 40 hours times 52 weeks plus 8 hours for an additional day equals to 2088 hours, minus 14 days off work, the total work time is 1976 hours or 118,560 minutes. This number can be used to calculate the cost per minute of all types of staff except

This research question aims to think deeper on the circumstances of the overuse of plastic and paper, and what could happen more to the animals/birds, our environment, and our bodies if consumers keep on using plastic and paper products. This research question should be asked to raise awareness to users and most importantly designers, so they consider using other eco friendly material in designing their products.