Dream Corporation is trying to improve its inventory control system and has installed an online computer at its retail stores. Howe anticipates sales of 126,000 units per year, an ordering cost of P4 per order, and carrying costs of P1.008 per unit. The following year, the company learns it can reduce ordering costs to P1 per order but that carrying costs will stay the same at P1.008 per unit. What is the total cost of inventory to be expected?
Q: Bonneau Corporation declares a cash dividend of $100,000 on July 1 for any shareholder on record on…
A: Dividends are the part or share of profits which is being distributed to the shareholders. It can be…
Q: In 2021, Dan Davis, age 85 and single, received Social Security benefits of $14,000, dividend and…
A: Social Security Benefit: It is the benefit which an individual get at the time or retirement or for…
Q: True or False: Borrowing and repaying debt principal does not impact net worth.
A: Net worth is the difference between the assets and liabilities of the company. If the assets are…
Q: M Inc. issued 2,000 convertible bonds in 2009 at a coupol nd a par value of £1,000. Each bond is…
A: Diluted EPS Diluted EPS is used to evaluate the quality of a company's earnings per share after all…
Q: On January 1, 2021, Morrow Inc. purchased a spooler at a cost of $40,000. The equipment is expected…
A: Depreciation expense per unit = (Cost- residual value)/Total expected units to produce
Q: Expound the following two physical control for cash received by cashiers in a grocery 1) The cash…
A: Since cash is the most liquid of all assets, a business cannot survive and prosper if it does not…
Q: 3.8 Cookie Light, Inc. normally produces 12,000 bottles of its product soda light. The following…
A: "Since you have asked multiple questions, we will solve first question for you. If you want any…
Q: How much is the amount of cash to be reported in the financial statements?
A:
Q: On January 4, 2021, Jonathan Company purchased 75% interest in Monica Corporation for P300,000.…
A:
Q: What is the normal balance of accounts payable? Group of answer choices debit either debit or credit…
A: Solution: Accounts payable are liabilities due to purchase of merchandise or services on account.…
Q: The four major financial reports that summarize the effects of economic events (like the results of…
A: Economic events are the financial transactions that are occurring in the regular course of business.…
Q: Income Statement Bullseye, Incorporated's 2018 income statement lists the following income and…
A:
Q: The following information has been extracted from the financial statements of Muggie Pty. Ltd., a…
A: Net profit is the net income of the business after considering all the expenses and all the incomes…
Q: For each of the following statements indicate if the statement is true or false. In your answer book…
A:
Q: K is a capitalist partner. In the articles of partnership, it was provided that K’s duty was to…
A: He will be entitled to right to compensation
Q: 1. Parent Company issued 75,000 new shares of its P5 par value ordinary shares valued at P12 per…
A:
Q: River and Co. has entered into a non-cancellable purchase contract which the company to purchase…
A: The company may enter into a non-non-cancellable purchase contract for the inventory to be…
Q: Choose a major publicly traded corporation, then go to the corporation's site and retrieve the…
A: The company that I have selected is Starbucks Corporation. The company was founded in the year…
Q: What is the process of transferring the debits and credits from the journal entries to the accounts…
A: Journal are the initial records of the transactions which are then posted into ledgers to every…
Q: ABC LLC is a calendar year LLC that was organized on April 1, 2020, and started business on May 1,…
A: There are some restriction over the calculation of deductible expenses in the Limited Liability…
Q: A, B, C and D are known robbers in their community. They created a Jewelry-on-hand Partnership so…
A: In any partnership, there are two or more partners who are responsible for running the business…
Q: GG Na Company has been undergoing liquidation since January 1. As of March 31, its condensed…
A: Statement of Realization and Liquidation: In case of bankruptcy, the court wants this statement so…
Q: i. Explain why the process costing approach is appropriate for this barbershop. ii. Calculate the…
A: A Local barbershop providing hair cutting services belongs to the service sector which is more of…
Q: Becky is a corporate account manager at a company that sells athletic equipment to other businesses.…
A: In the given question, Becky’s total earnings for the month was $ 3,782. These earnings included her…
Q: What is FMI’s unit cost if the commercial division buys its additional 5,000 units of part 23–6711…
A: The determination of unit cost of additional 5,000 units of part 23- 6711 and the correct transfer…
Q: sing the following accounts and balances, prepare the stockholders' equity section of the balance…
A: Stockholders' equity is the shares issued by the company that shows shares issued, paid-in capital,…
Q: Bonneau Corporation declares a cash dividend of $100,000 on July 1 for any shareholder on record on…
A: The dividend to shareholders is declared and paid from the retained earnings of the business.
Q: Using the following accounts and balances, prepare the stockholders' equity section of the balance…
A: The amount of assets remaining after all liabilities have been paid is referred to as stockholders'…
Q: Every partner may do acts of administration if there was no designated managing partner in the…
A: Partnership is an agreement between 2 or more person who are called as partners, agree to start and…
Q: The partnership is in need for an additional capital. As a capitalist partner, B was compelled to…
A: Capitalist partner refers to the partner who contributes property, money and his work or industry to…
Q: In 1989 Tom died and provided in his will that certain assets with a Fair Market Value of $6,100,000…
A: On the death of a person, all the properties he has are subject to estate tax and inheritance tax.…
Q: Information for the Hi-Test company’s production process for September follows. Assume that all…
A: The total cost of producing a product, including raw materials and operating costs, is detailed in a…
Q: Analyze the balance sheet
A:
Q: A consideration of internal control made during an audit is usually not sufficient to express an…
A: Internal controls procedures are those processes which are established for effective and efficient…
Q: What is the purpose of the statement of cash flows? What are the three types of cash flow…
A: 1. Cash flow statement : Cash flow is the financial statements which shows the cash inflow and cash…
Q: A project has a NPV of 15,000 when the cutoff rate is 10%. The annual cash flows are 20,505 on an…
A: Profitability index is used to see the attractiveness of investment or a project. It is also written…
Q: What is the normal balance of cash? Group of answer choices This is an ambiguous question debit…
A: Current assets are cash and cash equivalent and include those assets which are expected to be used…
Q: 5. The following is the year ended data for Baker Company: Sales Revenue £152,000 Cost of Goods…
A: Cost of goods available for sale is the sum of beginning inventory and cost of goods manufactured.
Q: Negotiations on a new contract have started. The contractor has 500 employees, the contract is 2.5%…
A: The correct answer for the above mentioned question is given in the following steps for your…
Q: For purposes of the election to defer Federal estate tax payments relative to an interest in a…
A: There is condition to elect extension of federal tax payment relative to an interest in a closely…
Q: Fast Trak Company, a domestic common carrier engaged in the transport of goods rovided the following…
A: 1. Non - VAT registered entity business tax = 1% of gross receipts = 1% x P2400000 = P 24000
Q: ) Appiah Company is a manufacturer of office desks. It uses a standard absorption costing system to…
A: Hi student Since there are multiple subparts, we will answer only first three subparts.
Q: explain each choices. Reportable conditions are matters that come to an auditor's attention and that…
A: Internal Control: An entity's board of directors, management, and other people are the ones who…
Q: Which of the following items has no effect on the Accumulated Adjustments Account (AAA) of an S…
A: Cost of goods sold- The cost of goods sold is the cost of producing the goods that a business sells.…
Q: If they divide the profits 2:4:6, how much should B receive?
A: 1. As no rate of interest on capital is mentioned in the question. So, no interest on…
Q: Choose the correct answer: Which of the following is equal to the SFP? A. Unadjusted trial…
A: Abbreviations used in the Question : SFP means Statement of Financial Position of Balance Sheet SCI…
Q: Victory Worship Partnership has the following account balances before liquidation (see attached…
A: As Given Before dissolution, Victory Worship Partnership had the following account balances. Some…
Q: Dee and Co. is a small manufacturing company which has prepared the following monthly budgeted…
A: Solution:- 1)Calculation of sales revenue in value required to make a target profit of GH¢ 80,000 as…
Q: Which of the following types of messages might the Active Auditor display? Question 9 options:…
A: The auditor uses various tools to help in carrying out audit procedures. The active auditor display…
Q: Regasco Gas Co. grants its customers one reward point per P100 sales. Each point is equivalent to…
A: The company may provide gift and reward while making sales to the customers and the customers then…
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- Ottis, Inc., uses 640,000 plastic housing units each year in its production of paper shredders. The cost of placing an order is 30. The cost of holding one unit of inventory for one year is 15.00. Currently, Ottis places 160 orders of 4,000 plastic housing units per year. Required: 1. Compute the economic order quantity. 2. Compute the ordering, carrying, and total costs for the EOQ. 3. How much money does using the EOQ policy save the company over the policy of purchasing 4,000 plastic housing units per order?Global Reach, Inc., is considering opening a new warehouse to serve the Southwest region. Darnell Moore, controller for Global Reach, has been reading about the advantages of foreign trade zones. He wonders if locating in one would be of benefit to his company, which imports about 90 percent of its merchandise (e.g., chess sets from the Philippines, jewelry from Thailand, pottery from Mexico, etc.). Darnell estimates that the new warehouse will store imported merchandise costing about 16.78 million per year. Inventory shrinkage at the warehouse (due to breakage and mishandling) is about 8 percent of the total. The average tariff rate on these imports is 5.5 percent. Required: 1. If Global Reach locates the warehouse in a foreign trade zone, how much will be saved in tariffs? Why? (Round your answer to the nearest dollar.) 2. Suppose that, on average, the merchandise stays in a Global Reach warehouse for nine months before shipment to retailers. Carrying cost for Global Reach is 6 percent per year. If Global Reach locates the warehouse in a foreign trade zone, how much will be saved in carrying costs? What will the total tariff-related savings be? (Round your answers to the nearest dollar.) 3. Suppose that the shifting economic situation leads to a new tariff rate of 13 percent, and a new carrying cost of 6.5 percent per year. To combat these increases, Global Reach has instituted a total quality program emphasizing reducing shrinkage. The new shrinkage rate is 7 percent. Given this new information, if Global Reach locates the warehouse in a foreign trade zone, how much will be saved in carrying costs? What will the total tariff-related savings be? (Round your answers to the nearest dollar.)Danna Martin, president of Mays Electronics, was concerned about the end-of-the year marketing report that she had just received. According to Larry Savage, marketing manager, a price decrease for the coming year was again needed to maintain the companys annual sales volume of integrated circuit boards (CBs). This would make a bad situation worse. The current selling price of 18 per unit was producing a 2-per-unit profithalf the customary 4-per-unit profit. Foreign competitors kept reducing their prices. To match the latest reduction would reduce the price from 18 to 14. This would put the price below the cost to produce and sell it. How could these firms sell for such a low price? Determined to find out if there were problems with the companys operations, Danna decided to hire a consultant to evaluate the way in which the CBs were produced and sold. After two weeks, the consultant had identified the following activities and costs: The consultant indicated that some preliminary activity analysis shows that per-unit costs can be reduced by at least 7. Since the marketing manager had indicated that the market share (sales volume) for the boards could be increased by 50% if the price could be reduced to 12, Danna became quite excited. Required: 1. CONCEPTUAL CONNECTION What is activity-based management? What phases of activity analysis did the consultant provide? What else remains to be done? 2. CONCEPTUAL CONNECTION Identify as many nonvalue-added costs as possible. Compute the cost savings per unit that would be realized if these costs were eliminated. Was the consultant correct in the preliminary cost reduction assessment? Discuss actions that the company can take to reduce or eliminate the nonvalue-added activities. 3. Compute the unit cost required to maintain current market share, while earning a profit of 4 per unit. Now compute the unit cost required to expand sales by 50%, assuming a per-unit profit of 4. How much cost reduction would be required to achieve each unit cost? 4. Assume that further activity analysis revealed the following: switching to automated insertion would save 60,000 of engineering support and 90,000 of direct labor. Now, what is the total potential cost reduction per unit available from activity analysis? With these additional reductions, can Mays achieve the unit cost to maintain current sales? To increase it by 50%? What form of activity analysis is this: reduction, sharing, elimination, or selection? 5. CONCEPTUAL CONNECTION Calculate income based on current sales, prices, and costs. Then calculate the income by using a 14 price and a 12 price, assuming that the maximum cost reduction possible is achieved (including Requirement 4s reduction). What price should be selected?
- The Home Depot is a leading specialty retailer of hardware and home improvement products and is the second-largest retail store chain in the United States. It operates large warehouse-style stores. Despite declining sales and difficult economic conditions in 20X1 and 20X2, The Home Depot continued to invest in new stores. The following table provides summary hypothetical data for The Home Depot. REQUIRED a. Use the preceding data for The Home Depot to compute average revenues per store, capital spending per new store, and ending inventory per store in 20X2. b. Assume that The Home Depot will add 100 new stores by the end of Year +1. Use the data from 20X2 to project Year +1 sales revenues, capital spending, and ending inventory. Assume that each new store will be open for business for an average of one-half year in Year +1. For simplicity, assume that in Year +1, Home Depots sales revenues will grow, but only because it will open new stores.Moses Moonrocks Inc. has developed a balanced scorecard with a measure map that suggests that the number of erroneous shipments has a direct effect on operating profit. The company estimates that every shipment error leads to a reduction of revenue by 3,000 and increased costs of about 2,000. If the company has the following budgeted sales and costs for next month (without accounting for any possible shipping errors), determine how many shipping errors the company can afford to have and still break even:Nico Parts, Inc., produces electronic products with short life cycles (of less than two years). Development has to be rapid, and the profitability of the products is tied strongly to the ability to find designs that will keep production and logistics costs low. Recently, management has also decided that post-purchase costs are important in design decisions. Last month, a proposal for a new product was presented to management. The total market was projected at 200,000 units (for the two-year period). The proposed selling price was 130 per unit. At this price, market share was expected to be 25 percent. The manufacturing and logistics costs were estimated to be 120 per unit. Upon reviewing the projected figures, Brian Metcalf, president of Nico, called in his chief design engineer, Mark Williams, and his marketing manager, Cathy McCourt. The following conversation was recorded: BRIAN: Mark, as you know, we agreed that a profit of 15 per unit is needed for this new product. Also, as I look at the projected market share, 25 percent isnt acceptable. Total profits need to be increased. Cathy, what suggestions do you have? CATHY: Simple. Decrease the selling price to 125 and we expand our market share to 35 percent. To increase total profits, however, we need some cost reductions as well. BRIAN: Youre right. However, keep in mind that I do not want to earn a profit that is less than 15 per unit. MARK: Does that 15 per unit factor in preproduction costs? You know we have already spent 100,000 on developing this product. To lower costs will require more expenditure on development. BRIAN: Good point. No, the projected cost of 120 does not include the 100,000 we have already spent. I do want a design that will provide a 15-per-unit profit, including consideration of preproduction costs. CATHY: I might mention that post-purchase costs are important as well. The current design will impose about 10 per unit for using, maintaining, and disposing our product. Thats about the same as our competitors. If we can reduce that cost to about 5 per unit by designing a better product, we could probably capture about 50 percent of the market. I have just completed a marketing survey at Marks request and have found out that the current design has two features not valued by potential customers. These two features have a projected cost of 6 per unit. However, the price consumers are willing to pay for the product is the same with or without the features. Required: 1. Calculate the target cost associated with the initial 25 percent market share. Does the initial design meet this target? Now calculate the total life-cycle profit that the current (initial) design offers (including preproduction costs). 2. Assume that the two features that are apparently not valued by consumers will be eliminated. Also assume that the selling price is lowered to 125. a. Calculate the target cost for the 125 price and 35 percent market share. b. How much more cost reduction is needed? c. What are the total life-cycle profits now projected for the new product? d. Describe the three general approaches that Nico can take to reduce the projected cost to this new target. Of the three approaches, which is likely to produce the most reduction? 3. Suppose that the Engineering Department has two new designs: Design A and Design B. Both designs eliminate the two nonvalued features. Both designs also reduce production and logistics costs by an additional 8 per unit. Design A, however, leaves post-purchase costs at 10 per unit, while Design B reduces post-purchase costs to 4 per unit. Developing and testing Design A costs an additional 150,000, while Design B costs an additional 300,000. Assuming a price of 125, calculate the total life-cycle profits under each design. Which would you choose? Explain. What if the design you chose cost an additional 500,000 instead of 150,000 or 300,000? Would this have changed your decision? 4. Refer to Requirement 3. For every extra dollar spent on preproduction activities, how much benefit was generated? What does this say about the importance of knowing the linkages between preproduction activities and later activities?
- Poleski Manufacturing, which maintains the same level of inventory at the end of each year, provided the following information about expenses anticipated for next year: The selling price of Poleskis single product is 16. In recent years, profits have fallen and Poleskis management is now considering a number of alternatives. Poleski wants to have a net income next year of 250,000, but expects to sell only 120,000 units unless some changes are made. The president of Poleski has asked you to calculate the companys projected net income (assuming 120,000 units are sold) and the sales needed to achieve the companys net income objective for next year. Also, compute Poleskis contribution margin per unit, contribution margin ratio, and break-even point for next year. The worksheet CVP has been provided to assist you. Note that the data from the problem have already been entered into the Data Section of the worksheet.Costco is the largest chain of membership warehouse clubs in the world, based on sales volume, and it is the fifth largest general retailer in the United States. Costco focuses on selling products at low prices, often at a very high volume. These goods are usually bulk-packaged and marketed primarily to large families and businesses. Costco became the first company to grow from zero to 3 billion in sales in less than six years. In a recent fiscal year, Costcos sales totaled 116 billion, a 2 percent increase from 2015, and its net income reached 2.35 billion, an 1 percent decrease from 2015. This information, and much more, can be derived from the financial statements that merchandising firms such as Costco prepare on a regular basis to provide shareholders and other interested parties information about the companys activities and financial performance. 1. What type of information would a classified income statement provide to shareholders and other interested parties? 2. What type of information would a classified balance sheet provide to shareholders and other interested parties? Why would this information be important for calculating the working capital and the current ratio, for example?Dream Corporation is trying to improve its inventory control system and has installed an online computer at its retail stores. Howe anticipates sales of 126,000 units per year, an ordering cost of P4 per order, and carrying costs of P1.008 per unit. The following year, the company. learns it can reduce ordering costs to P1 per order but that carrying costs will stay the same at P1.008 per unit. What is the total cost of inventory to be expected?
- Fisk Corporation is trying to improve its inventory control system and has installed an online computer at its retail stores. Fisk anticipates sales of 60,500 units per year, an ordering cost of $12 per order, and carrying costs of $1.20 per unit.a. What is the economic ordering quantity?___________Units b. How many orders will be placed during the year? __________Orders c. What will the average inventory be? ____________Units d. What is the total cost of ordering and carrying inventory? $____________Arcadia Windings is concerned about its stocks of copper cable. The demand for this is 8,000 meters a week, with a cost of £ 4 a meter. Each order costs £ 350 for administration and £ 550 for delivery, and has a lead time of 8 weeks. Holding costs are about 25 per cent of value held a year, and any shortages would disrupt production and give very high costs. What is the best inventory policy for the cable? How does this compare with the current policy of placing a regular order every week?Kiley Corporation had the following data for the most recent year (in millions). The new CFO believes (1) that an improved inventory management system could lower the average inventory by $4,000, (2) that improvements in the credit department could reduce receivables by $2,000, and (3) that the purchasing department could negotiate better credit terms and thereby increase accounts payable by $2,000. Furthermore, she thinks that these changes would not affect either sales or the costs of goods sold. If these changes were made, by how many days would the cash conversion cycle be lowered? (Hint: Calculate the CCC for original and then for revised and take the difference. SHOW ALL WORK)