3. Mr. Wichai is a native of Khon Kaen province who wants to open a sausage shop near the university with 3 locations as an option. which has the following details · Location 1: In front of Silpakorn University, rent at 8,000 baht/month, cost of sausages 5 baht/wood, transportation cost 0.25 baht/wood, expected to generate sales of 5,000 sticks/month. • Location 2: Behind Khon Kaen University, rent at 5,000 baht/month, sausage cost 5 baht/wood, transportation fee 0.50 baht/wood, expected to generate sales of 4,200 sticks/month. • Location 3: Chiang Mai University canteen, rent at 4,500 baht/month, cost of sausages 5 baht/wood, is expected to generate sales of 3,000 sticks/month. The selling price of wooden sausages is 10 baht per stick. Which location should Mr. Wichai choose that generates the most profit? and how much profit(

3. Mr. Wichai is a native of Khon Kaen province who wants to open a sausage shop near the university with 3 locations as an option. which has the following details · Location 1: In front of Silpakorn University, rent at 8,000 baht/month, cost of sausages 5 baht/wood, transportation cost 0.25 baht/wood, expected to generate sales of 5,000 sticks/month. • Location 2: Behind Khon Kaen University, rent at 5,000 baht/month, sausage cost 5 baht/wood, transportation fee 0.50 baht/wood, expected to generate sales of 4,200 sticks/month. • Location 3: Chiang Mai University canteen, rent at 4,500 baht/month, cost of sausages 5 baht/wood, is expected to generate sales of 3,000 sticks/month. The selling price of wooden sausages is 10 baht per stick. Which location should Mr. Wichai choose that generates the most profit? and how much profit(

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter1: Introduction To Managerial Accounting

Section: Chapter Questions

Problem 15E: Ethical Behavior Consider the following scenario between Dave, a printer, and Steve, an assistant in...

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Ethical Behavior Consider the following scenario between Dave, a printer, and Steve, an assistant in the local universitys athletic department. Steve: Dave, our department needs to have 10,000 posters printed for the basketball team for next year. Heres the mock-up, and well need them in a month. How much will you charge? Dave: Well, given the costs I have for ink and paper, 1 can come in at around 5,000. Steve: Great, heres what I want you to do. Print me up an invoice for 7,500. Huts our budget. Then, when they pay you, you give me a check for 2,500. Ill make sure that you get the job. Required: CONCEPTUAL CONNECTION Is Steves proposal ethical? What should Dave do?
1. University Catering sells 50 pound bags of popcorn in the university dormitories for P10 abag. Fixed cost of this operation are P80,000 while variable costs of the popcorn are P.10per pound.a. What is the BEP in bags?b. Calculate the EBIT or loss on 12,000 bags and 25,000 bags.c. Calculate the EBIT or loss on 25,000 bags.
The Hub Store at a university in eastern Canada is considering purchasing a self-serve checkout machine similar to those used in many grocery stores and other retail outlets. Currently the university pays part-time wages to students totalling $58,000 per year. A self-serve checkout machine would reduce part-time student wages by $38,000 per year. The machine would cost $300,000 and has a 10-year useful life. Total costs of operating the checkout machine would be $5,600 per year, including maintenance. Major maintenance would be needed on the machine in five years at a total cost of $10,600. The salvage value of the checkout machine in 10 years would be $43,000. The CCA rate is 25%. Management requires a 10% after-tax return on all equipment purchases. The company’s tax rate is 30%. Required:1. Determine the before-tax net annual cost savings that the new checkout machine will provide. 2-a. Using the data from (1) above and other data from the exercise, compute the checkout…
The Hub Store at a university in eastern Canada is considering purchasing a self-serve checkout machine similar to those used in many grocery stores and other retail outlets. Currently the university pays part-time wages to students totalling $63,500 per year. A self-serve checkout machine would reduce part-time student wages by $43,500 per year. The machine would cost $410,000 and has a 10-year useful life. Total costs of operating the checkout machine would be $6,700 per year, including maintenance. Major maintenance would be needed on the machine in five years at a total cost of $11,700. The salvage value of the checkout machine in 10 years would be $48,500. The CCA rate is 25%. Management requires a 9% after-tax return on all equipment purchases. The company’s tax rate is 30%. Using the data from (1) above and other data from the exercise, compute the checkout machine’s net present value. (Hint: Use Microsoft Excel to calculate the discount factor(s).)
Parsa Real Estate is a company that buys and rents real estate. The company is looking into buying an office building for $1M. The building has 10,000 square feet of rentable office space. The company analysts predict that they can rent the office space for $6 per square foot per month, but demand is a function of price in the following way: % Occupied = 2 - 0.2*Rent (Rent is in dollars per square foot per month. Also, at $6.00, Oscar thinks he can fill about 80% of the office space.) The building needs to be maintained (security, insurance, maintenance, etc.), which costs $10,000 per month regardless of occupancy. Also, there is a variable cost of $2 per month for each square foot occupied. Define the return on invested capital as the ratio of the profits (PER YEAR) and the invested capital. You can draw an ROIC tree in the same way that we drew a KPI tree in class. Simply have the ROIC as “the root” of the tree instead of profits. Then answer the following question. What is the ROIC?
María has 2 “carretas” for selling her products in shopping centers (One “carreta” per location: Plaza Carolina, Plaza del Sol). Each location sells annually $285,000 (Total Sales Revenues $570000 = 285000 * 2) with a 40% Gross Margin. Annually each location has salaries and related expenses of $45,000. Annual expenses for Rent and all other expenses are $56,000 for each location. To improve sales and profits, Maria is considering the strategy of adding a “carreta” in Plaza Las Américas (PLA) where she expects to sell per year $345000. In PLA annual salaries and related expenses would also be $45,000, but rent and other costs would be $68000. The initial investment to start in PLA would be $25,000 (for inventory and some rent prepayments). Required Return is 20%. What is the strategy Net Present Value (adding Plaza Las Américas)?
1. A recently retired professor, Melinda Marketing, plans to establish the Hot-Air FanCompany and manufacture circulating fans. She estimates the fixed cost of operations tobe $357,500 annually. The variable cost of producing the fans is forecasted to be $85 perunit.a. How many fans must be sold to break even if the fans are priced at $150?b. If Hot-Air sells 6,000 fans, what will be the EBIT?c. If Hot-Air sells 6,000 fans and has interest expense of $8,125, what is Hot-Air’stimes-interest-earned? Hot-Air does not have any nonoperating expenses.d. If the fans are priced at $150, what is Hot-Air’s breakeven sales? 2. Vapor Lock Motors’ EBIT is $7,000,000, the company’s interest expense is $2,000,000, and its tax rate is 40 percent. Vapor Lock’s beta is 1.5. a. What is Vapor Lock’s DFL? b. If Vapor Lock were able to grow its EBIT by 50%, what would be the percentage increase in net income? c. If Vapor Lock were able to grow its EBIT by 50%, what would be the resulting net income? 3. A…
Crepe Creations (CC) is considering franchising its unique brand of crepes to stall- holders on Hermoza Beach, which is four miles long. CC estimates that, on an average day, there are 1,000 sunbathers evenly spread along the beach and each sunbather will buy one crepe per day provided that the price plus any disutility cost does not exceed $5. Each sunbather incurs a disutility cost of getting up from resting to get a crepe and returning to their beach spot of 25 cents for every 1⁄4 mile the sunbather has to walk to get to the CC stall. Each crepe costs $0.50 to make and CC incurs a $40 overhead cost per day to operate a stall. What price should CC charge if it only has one store? What profit would CC gain if it only has one store? How many franchises should CC award given that it determines the prices the stall holders can charge and that it will have a profit-sharing royalty scheme with the stall holders? What is price of a crepe at each stall?
solve a,b and c please. Mcleavey Manufacturing has a demand for 1,000 pumps each year. The company outsources her production by ordering outside supplier, unit purchase price is 60$/ unit. Mc Leavey Manufacturing has to rent warehouse 10% of unit cost per year. And Mc Leavey Manufacturing pays for investment cost of 10% of unit cost per year. For ordering, the company must pay 50$/ order. a. What do you recommend if Mc Leavey Manufacturing get discount from his vendor with below schemes: Order quantity: discount price Less than 150 pumps: 5% discount rate More than 150 pumps: 10% discount rate b. If the company has plan to produce by themself then what is optimal production quantity? (given that they have production rate is 1500 units/year and setup cost is 100$). c. What is the optimal total annual inventory cost if they produce?
The owner of Genuine Subs, Inc., hopes to expand the present operation by adding one new outlet.She has studied three locations. Each would have the same labor and materials costs (food, servingcontainers, napkins, etc.) of $1.76 per sandwich. Sandwiches sell for $2.65 each in all locations.Rent and equipment costs would be $5,000 per month for location A, $5,500 per month for location B, and $5,800 per month for location C.a. Determine the volume necessary at each location to realize a monthly profit of $10,000.b. If expected sales at A, B, and C are 21,000 per month, 22,000 per month, and 23,000 permonth, respectively, which location would yield the greatest profits?
Three years ago, Marissa Moore started a business that creates and delivers holiday and birthday gift baskets to students at the local university. Marissa sells the baskets for $25 each, and her variable costs are $15 per basket. She incurs $12,000 in fixed costs each year. How many baskets will Marissa have to sell this year if she wants to earn $30,000 in operating income? (Round answer to 0 decimal places, e.g. 5,275.)
To generate leads for new business, Gustin Investment Services offers free financial planningseminars at major hotels in Southwest Florida. Gustin conducts seminars for groupsof 25 individuals. Each seminar costs Gustin $3,500 and the average first-year commissionfor each new account opened is $5,000. Gustin estimates that for each individualattending the seminar, there is a 0.01 probability that he/she will open a new account. a. Determine the equation for computing Gustin’s profit per seminar, given values of therelevant parameters.