a) Calculate the current annual total inventory costs b) Calculate the economic order quantity c) Calculate the annual total inventory costs if EOQ is used
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Jason owns a fish shop where he sells an exotic variety of tuna fish which he imports from Japan.
Jason refrigerates the fish in a cold storage facility near his shop that charges him a fixed annual fee of $1000 and variable charge of $5 per day for each fish container that is stored.
Every morning, Jason brings fish from the cold storage to his shop for sale. Jason estimates that he incurs $10,000 electricity cost each year on refrigerating the fish inside his own shop.
Jason incurs the following ordering costs:
Delivery charges of $10,000 per delivery
Import duties of $300 per carton
Custom fees of $200 per order
Import license fee of $150 per annum
Jason currently imports fish by placing one order of 20 cartons every month. Each carton costs $2,000.
Jason is wondering if he can save inventory costs by adopting EOQ model.
a) Calculate the current annual total inventory costs
b) Calculate the economic order quantity
c) Calculate the annual total inventory costs if EOQ is used
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- Hassad owns a rental house on Lake Tahoe. He uses a real estate firm to screen prospective renters, but he makes the final decision on all rentals. He also is responsible for setting the weekly rental price of the house. During the current year, the house rents for 1,500 per week. Hassad pays a commission of 150 and a cleaning fee of 75 for each week the property is rented. During the current year, he incurs the following additional expenses related to the property: a. What is the proper tax treatment if Hassad rents the house for only 1 week (7 days) and uses it 50 days for personal purposes? b. What is the proper tax treatment if Hassad rents the house for 8 weeks (56 days) and uses it 44 days for personal purposes? c. What is the proper tax treatment if Hassad rents the house for 25 weeks (175 days) and uses it 15 days for personal purposes?Mr. Juan is a retired government employee who is good at baking. One day he decides to put up a bakery shop in your barangay. He renovated a portion of his house to serve as the area of the production of bread. He purchase baking equipment and raw materials to produce five different types of bread. Mr. Juan also hires Jose to help him with the baking and at the same time, to be in-charge of sales. Mr. Juan pays Jose on weekly basis. Every day, Mr. Juans wife deposits the daily cash sales in their bank account at XY Savings Bank. Question: With the help of accounting, what possible decisions or questions of Mr. Juan can accounting provide an answer to?Mr. Juan is a retired government employee who is good at baking. One day he decides to put up a bakery shop in your barangay. He renovates a portion of his house to serve as the area for the production of bread. He purchases baking equipment and raw materials to produce five different types of bread. Mr. Juan also hires Jose to help him with the baking and, at the same time, to be in-charge of sales. Mr. Juan pays Jose on a weekly basis. Every day, Mr. Juan's wife deposits the daily cash sales in their bank account at XY Savings Bank. With the help of accounting, what possible decisions or questions of Mr. Juan can accounting provide an answer to?
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- Chelsea Menken, of Providence, Rhode Island, recently graduated with a degree in food science and now works for a major consumer foods company earning $70,000 per year with about $57,600 in take-home pay. She rents an apartment for $1,200 per month. While in school, she accumulated about $37,000 in student loan debt on which she pays $385 per month. During her last fall semester in school, she had an internship in a city about 100 miles from her campus. She used her credit card for her extra expenses and has a current debt on the account of $8,000. She has been making the minimum payments on the account of about $240 a month. She has assets of $14,000. 1. Calculate Chelsea’s debt payments-to-disposable income ratio. Round your answer to two decimal places.Abdul works full-time in a bookstore. He earns a take-home salary of $580 a week. His expenses are $770 a month for rent and utilities, $41 a month for his cell phone, $80 a week for groceries, and $150 every two weeks for miscellaneous expenses. How much can Abdul save each month?Seiko's current salary is $98,500. Her marginal tax rate is 32% and she fancies European sports cars. She purchases a new auto every year. Seiko is currently a manager for Idaho Supply Company. Her friend, knowing her interest in sports cars, tells her about a manager position at the local BMW and Porche dealer. The new position pays only $87,100 per year, but it allows employees to purchase one new car per year at a discount of $17,700. This discount qualifies as a non-taxable fringe benefit. In an effort to keep Seiko as an employee, Idaho Supply Company offers her a $12,400 raise. Answer the following questions about this analysis. (a) What is the annual after-tax cost to the Idaho Supply Company with the $12,400 increase? (Ignore payroll taxes) (b-1) Financially which offer is better on an after-tax basis? (b-2) By how much is the offer better for Seiko on an after tax basis (Assume that Seiko is going to purchase the car whether she switches jobs or not)