Carol Cagle has a repetitive manufacturing plant producing trailer hitches in Arlington, Texas. The plant has an average inventory turnover of only 12 times per year. He has therefore determined that he will reduce his component lot sizes. He has developed the following data for one component, the safety chain clip: Setup labor cost Annual holding cost Daily production Annual demand Desired lot size $30 per hour $13 per unit 960 units/8 hour day 24,840 (270 days each x daily demand of 92 units) 120 units (one hour of production) To obtain the desired lot size, the set-up time that should be achieved = ☐ minutes (round your response to two decimal places).
Q: Finish Se Candidate: SHARMA H Based on the following table, what is the total amount of earned…
A: A Registered Retirement Savings Plan (RRSP) is a tax-advantaged savings and investment account…
Q: You are given the following information on Parrothead Enterprises: Debt: 9,500 7 percent coupon…
A: WACC can be referred as the weighted average capital cost that will be incurred by the company for…
Q: 1. What is the value at the end of Year 3 of the following cash flow stream if interest is 4%…
A: The problem case focuses on calculating the value of the cash flows at the end of year 3 as well as…
Q: After deciding to buy a new car, you can either lease the car or purchase it on a three-year loan.…
A: Lease is a way to get the asset for a fixed time period by paying periodicals payments to other…
Q: Marginal Tax Rate Chart Marginal Tax Rate Tax Bracket $0-$10,275 10% $10,276-$41,175 12%…
A: Taxes on taxable income refer to the amount of money that individuals or businesses owe to the…
Q: You are going to value Lauryn's Doll Co. using the FCF model. After consulting various sources, you…
A: Asset Beta : Asset beta calculates the market risk of a business entity without the impact of debt.…
Q: Pro 70 tamoms or to insong 3) What is the annual interest rate earned on a deposit that grew from…
A: Number of years (n) = 5Future Value after 5 years = $502.84Present Value = $250We need to calculate…
Q: roblem 08.017 - Determine annual cash flow Lesco Chemical is considering two processes for making a…
A: Operating cost:The expenses that are incurred to run the day-to-day operations of the regular…
Q: Taylor Company has a bond issue of $1000 par value bonds with a 6% annual coupon interest rate. Th…
A: Bond refers to the financial instrument issued by banks or financial institutions for raising funds…
Q: Economy Recession Normal Boom Probability of State of Economy .24 .64 .12 Rate of Return if State…
A: a). The expected return on stocks is calculated as the weighted average of probability and its…
Q: United Pigpen is considering a proposal to manufacture high-protein hog feed. The project would make…
A: ----------------
Q: We are evaluating a project that costs $691,200; has an eight-year life, and has no salvage value.…
A: Sensitivity analysis determines how different values of an independent variable affect a particular…
Q: Suppose your firm is considering investing in a project with the cash flows shown below, that the…
A: The Profitability Index (PI) decision rule is a financial metric used in capital budgeting to…
Q: Should it replace the old steamer? The old steamer ( be replaced. What is the NPV of the project? Do…
A: Capital budgeting is setting long-term spending priorities. It entails weighing your options and…
Q: Suppose a stock had an initial price of $60 per share, paid a dividend of $.60 per share during the…
A: Initial share price = $60Dividend = $0.60Ending share price = $72
Q: Perpetuities are also called annuities with an extended or unlimited life. Based on your…
A: The objective of the question is to identify the characteristics of a perpetuity. A perpetuity is a…
Q: Rare Agri-Products Ltd. is considering a new project with a projectedlife of seven (7) years. The…
A: The objective of the question is to calculate the initial investment required for the project.
Q: 45. What is the yield to maturity of a TVA bond that has a 9 1/2 percent coupon, pays interest…
A: Yield to maturity is the IRR of the cash flows generated by the bond till the maturity.Face value =…
Q: Find the effective rate for a payday loan which charges $37.78 for a two week loan of $280. The…
A: The Effective Annual Rate (EAR) is the interest rate that is adjusted for compounding over a given…
Q: ou took out a fully amortizing 30 year mortgage with the initial balance of $7036. This mortgage has…
A: The objective of the question is to calculate the remaining balance on a 30-year mortgage after five…
Q: 1. You recently won a lottery and have the option of receiving one of the following three prizes:…
A: Present Value-Present value is the concept that states that an amount of money today is worth more…
Q: The index model has been estimated from the excess returns for stock A with the following results:…
A: RA12.00%+1.55Rm+eAσM24.00%σ(eA)18.50%
Q: XYZ stock price and dividend history are as follows: Beginning-of-Year Dividend Paid at Price Year…
A: Weighted average return:Weighted average return is a financial metric used to calculate the overall…
Q: You work for a nuclear research laboratory that is contemplating leasing a diagnostic scanner…
A: Net Advantage to Leasing (NAL) is a financial metric used to evaluate the financial viability of…
Q: 9. The Patrick Company's cost of common equity (rs) is 16%, its before-tax cost of debt (ra) is 8%,…
A: Given Data: No. of common Equity200000No of Long term Debt2000Market Price of Shares41Market Price…
Q: Farmer Smith has some ranch land. He can buy a heard of young steers for $10,000, graze them on his…
A: Cash flow holds paramount importance in financial economics, mirroring a business's liquidity and…
Q: You plan to invest $10,000 in an engineering project. You want to recover your irrvestment in 5…
A: Compound = Semiannually = 2Present Value = pv = $10,000Time = t = 5 * 2 = 10Semiannually Interest…
Q: Missing information on a bond considering as a potential invest the two different bonds is the fol…
A: Bond Valuation refers to process involved in ascertaining market worth for bond or debenture. It is…
Q: Problem 9-34 (Algo) Yield on Investment [LO9-4] C. D. Rom has just given an insurance company…
A: Investment amount$46,500.00Amount of annuity received$6,600.00Number of years20 years
Q: Pinnacle Corp. issued 4% bonds on October 1, 2022. The bonds have a maturity date of September 30,…
A: Bonds:A fixed-income generating instrument that represents the loan given by the investor to the…
Q: Northern Wood Products is an all-equity firm with 25,100 shares of stock outstanding and a total…
A: Earning per share refers to an income attributable to the outstanding shareholders out of the…
Q: 5-year Treasury bonds yield 5.8 %. The inflation premium (IP) is 1.9 %, and the maturity risk…
A: treasury bond yields:
Q: Consider a firm with an EBIT of $859,000. The firm finances its assets with $2,590,000 debt (costing…
A: Given Data:EBIT = 859000Tax Rate = 21%
Q: Should your company replace its year - old machine? What is the NPV of replacement? The NPV of…
A: The net present value is a tool if an investment is likely to yield higher returns in the future. It…
Q: Pharoah Company is considering buying a new farm that it plans to operate for 10 years. The farm…
A: NPV is defined as the sum of the present values of all future cash inflows less the sum of the…
Q: Raymond Mining Corporation has 9.1 million shares of common stock outstanding, 350,000 shares of 4%…
A: Weighted average cost of capital ( WACC )WACC is the rate at which the company on average would be…
Q: 20 years at 11% interest compounded annually? How much will it be worth in 30 years? What about at…
A: The future value is determining how much money you will have in the future based on the current…
Q: . What is DLW's year 1 cost recovery for each asset?
A: Under half-year convention for personal property, calculated as follows:
Q: The data in Exhibit 1 appear in the five-year summary of a major international company. EXHIBIT 1…
A: The objective of this question is to calculate the Total Asset Turnover ratio for the financial year…
Q: Please round the answer up to TWO decimal places.
A: The answer is in the explanation.Explanation:1. Calculate the future cost of the university fees for…
Q: Stock C is recovering from several years of losses, during which its dividend was cut to $.50 per…
A: The problem case requires to calculate the current stock price. the stock price will be calculated…
Q: 1. A project that provides annual cash flows of $53,500 for 10 years costs $308,000 today. (1) Based…
A: NPV is the best capital budgeting tool to evaluate a project. It is the present value of cash…
Q: Ms. Jones wants to make 8% nominal interest compounded quarterly on a bond investment. She has an…
A: A bond is a fixed-income instrument showing an investor loan to a borrower (typically corporate or…
Q: You found a bunch of printed shares of a corporation whose shares are traded in Borsa İstanbul at…
A: The process of converting physical securities, such as paper share certificates into electronic form…
Q: Data table MACRS Fixed Annual Expense Percentages by Recovery Class Click on this icon to download…
A: The question provides a data table of the Modified Accelerated Cost Recovery System (MACRS) Fixed…
Q: National Home Rentals has a beta of 1.06, a stock price of $17, and recently paid an annual dividend…
A: Beta1.06Stock price$17.00Annual dividend$0.92Growth rate2.2%Market rate of return11.2%Risk…
Q: Suppose you feel that the values are accurate to within only ±10 percent. What are the best-case and…
A: The net present value is a useful measure for determining the investment value. It looks at the…
Q: The Charles Barkley Fitness Club is looking to expand its current facility by adding space for more…
A: NPV is the most used method for analysis of projects based time value of money and it should be…
Q: Free Cash Flow Iron Ore Corporation reported free cash flows for 2022 of $114 million and investment…
A: Free cash flow is the cash flow generated after taking into account:DepreciationCapital expenditure,…
Q: Question 2 (30 Marks) (a) You want to estimate the daily value at risk (VaR) for the stock returns…
A: The first part of the question is asking to estimate the daily Value at Risk (VaR) and Expected…
Trending now
This is a popular solution!
Step by step
Solved in 1 steps
- Carol Cagle has a repetitive manufacturing plant producing trailer hitches in Arlington, Texas. The plant has an average inventory turnover of only 12 times per year. He has therefore determined that he will reduce his component lot sizes. He has developed the following data for one component, the safety chain clip: Setup labor cost Annual holding cost Daily production Annual demand Desired lot size To obtain the desired lot size, the set-up time that should be achieved = $30 per hour $15 per unit 976 units/8 hour day 33,000 (275 days each x daily demand of 120 units) 122 units (one hour of production) minutes (round your response to two decimal places).Carol Cagle has a repetitive manufacturing plant producing trailer hitches in Arlington, Texas. The plant has an average inventory turnover of only 12 times per year. He has therefore determined that he will reduce his component lot sizes. He has developed the following data for one component, the safety chain clip: Setup labor cost Annual holding cost Daily production Annual demand Desired lot size $25 per hour $16 per unit 1,008 units/8 hour day 42,000 (250 days each x daily demand of 168 units) 126 units (one hour of production) To obtain the desired lot size, the set-up time that should be achieved = ☐ minutes (round your response to two decimal places).Carol Cagle has a repetitive manufacturing plant producing trailer hitches in Arlington, Texas. The plant has an average inventory turnover of only 12 times per year. He has therefore determined that he will reduce his component lot sizes. He has developed the following data for one component, the safety chain clip: Setup labor cost $20 per hour Annual holding cost $15 per unit Daily production 976 units/8 hour day Annual demand 36,000 (250 days each×daily demand of 144 units) Desired lot size 122 units (one hour of production) To obtain the desired lot size, the set-up time that should be achieved = nothing minutes (round your response to two decimal places).
- The F Inc.’s materials manager is considering the installation of a just-in-time (JIT) inventory system for L-20, one of the chemicals used in the production process. Currently, the chemical is purchased for $30 each pound. The firm uses 4,800 pounds L-20 per year. The controller estimates that it costs $150 to place and receive a typical order of L-20. The annual cost of storing L-20 is $1 per pound. F Inc.’s manufacturing engineering team identifies the following effects of adopting a JIT inventory system: 1) F Inc. will order 100 pounds L-20 each time. 2) The cost of placing an order for L-20 will be reduced to $20. 3) Suppliers would add $4 to the price per pound for frequent deliveries. 4) Currently there is a defect-assessment cost of $120,000 per year. This cost is expected a reduction of 20% under the JIT system. F Inc. requires a 10% annual rate of return on investment Required: From a financial perspective, determine whether it is in the best interest of F to…As the newly appointed Controller of Lynbrook, Inc. you have been asked to evaluate several scenarios that management is considering to improve the overall profitability of the company. Lynbrook manufactures and sells a product called a Wren, its only product. The company normally produces and sells 60,000 Wrens each year at a selling price of $32 per unit. The company's unit costs at this level of activity are included below: Direct materials $10.00 Direct labor 4.50 Variable manufacturing 2.30 overhead Fixed manufacturing overhead 5.00 ($300,000 total) Variable selling expenses 1.20 Fixed selling expenses 3.50 ($210,000 total) Total cost per unit $26.50 The CFO of Lynbrook would like your response to the following three (3) independent situations to present to the management team early next week. Situation #1 Assume that Lynbrook has sufficient capacity to produce 90,000 Wrens each year without any increase in fixed manufacturing overhead costs. The company could increase its unit…A company is analyzing a make-versus-purchase situation for a component used in several products, and the engineering department has developed these data:Option A: Purchase 10,000 items per year at a fixed price of $8.50 per item. The cost of placing the order is negligible according to the present cost accounting procedure. Option B: Manufacture 10,000 items per year, using available capacity in the factory. Cost estimates are direct materials = $5.00 per item and direct labor = $1.50 per item. Manufacturing overhead is $3.00 per item. Based on these data, should the item be purchased or manufactured?
- A company is analyzing a make-versus-purchase situation for a component used in several products and the engineering department has developed these data: Option A: Purchase 10,000 items per year at a fixed cost of Php 340 per item. The cost of placing the order is negligible according to the present cost accounting procedure. Option B: Manufacture 10,000 items per year, using available capacity in the factory. Cost estimates are direct materials= Php 200 per item and direct labor = Php 60 per item. Manufacturing overhead is allocated at 200% of direct labor. Based on these data, should the item be purchased or manufacture?Global GPS industries assembles its GPS systems with the following costs. Each or requires one computer system and 4 batteries. Computer systems cost $140 each, and Batteries are $2.50 each. Global is able to reliably obtain computers as needed and does not maintain them in inventory. However, batteries are stocked in inventory sufficient to produce 20% of the following month's expected production. Planned production is as follows: January February March April 24,000 systems 39,750 systems 23,850 systems 25,000 systems BB batter Compute No end/No Required: Prepare a direct material purchasing plan for January, February, and March based on the above facts.The Colin Division of Sunland Company sells its product for $32 per unit. Variable costs per unit include: manufacturing, $14; and selling and administrative, $3. Fixed costs are: $200000 manufacturing overhead, and $60000 selling and administrative. There was no beginning inventory. Expected sales for next year are 40000 units. Edward Lewis, the manager of the Colin Division, is under pressure to improve the performance of the Division. As part of the planning process, he has to decide whether to produce 40000 units or 60000 units next year. What would the net income be under variable costing for each alternative? 40000 units 60000 units $380000 $340000 $340000 $392000 $340000 $340000 $340000 $500000
- Magnificent Modems has excess production capacity and is considering the possibility of making and selling security tokens. The following estimates are based on a production and sales volume of 1,000 security tokens. Unit-level manufacturing costs are expected to be $20. Sales commissions will be established at $1 per unit. The current facility-level costs, including depreciation on manufacturing equipment ($60,000), rent on the manufacturing facility ($50,000), depreciation on the administrative equipment ($12,000), and other fixed administrative expenses ($71,950), will not be affected by the production of the security tokens. The chief accountant has decided to allocate the facility-level costs to the existing product (modems) and to the new product (security tokens) on the basis of the number of units of product made (i.e., 5,000 modems and 1,000 security tokens). Required a. Determine the per-unit cost of making and selling 1,000 security tokens. Note: Do not round intermediate…Futura Company purchases the 66,000 starters that it installs in its standard line of farm tractors from a supplier for the price of $13.20 per unit. Due to a reduction in output, the company now has idle capacity that could be used to produce the starters rather than buying them from an outside supplier. However the company's chief engineer is opposed to making the starters because the production cost per unit is $14.10 as shown below. Direct materials Direct labor Supervision Depreciation Variable manufacturing overhead Rent Total product cost Per unit $ 7.00 2.50 1.90 1.40 0.70 0.60 $14.10 Total Financial (disadvantage) $125,400 $ 92,400* $ 39,600 If Futura decides to make the starters, a supervisor would have to be hired (at a salary of $125,400) to oversee production. However, the company has sufficient idle tools and machinery such that no new equipment would have to be purchased. The rent charge above is based on space utilized in the plant. The total rent on the plant is…The Knot manufactures men’s neckwear at its Spartanburg plant. The Knot is considering implementing a JIT production system. The following are the estimated costs and benefits of JIT production: a. Annual additional tooling costs $250,000 annually. b. Average inventory would decline by 80% from the current level of $1,000,000. c. Insurance, space, materials-handling, and setup costs, which currently total $400,000 annually, would decline by 20%. d. The emphasis on quality inherent in JIT production would reduce rework costs by 25%. The Knot currently incurs $160,000 in annual rework costs. e. Improved product quality under JIT production would enable The Knot to raise the price of its product by $2 per unit. The Knot sells 100,000 units each year. The Knot’s required rate of return on inventory investment is 15% per year. Q. Calculate the net benefit or cost to The Knot if it adopts JIT production at the Spartanburg plant.