Answered: Operations

Business

Operations Management

Operations

Marketing

20th Edition

ISBN:9780357033791

Author:Pride, William M

Publisher:Pride, William M

Chapter19: Pricing Concepts

Section: Chapter Questions

Problem 6DRQ

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Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing expenditures for packaging materials with Jeff Joyner. Ben was particularly disturbed about the amount spent on corrugated boxes purchased from Southeastern Corrugated. Ben said, I dont like the salesman from that company. He comes around here acting like he owns the place. He loves to tell us about his fancy car, house, and vacations. It seems to me he must be making too much money off of us! Jeff responded that he heard Southeastern Corrugated was going to ask for a price increase to cover the rising costs of raw material paper stock. Jeff further stated that Southeastern would probably ask for more than what was justified simply from rising paper stock costs. After the meeting, Ben decided he had heard enough. After all, he prided himself on being a results-oriented manager. There was no way he was going to allow that salesman to keep taking advantage of Coastal Products. Ben called Jeff and told him it was time to rebid the corrugated contract before Southeastern came in with a price increase request. Who did Jeff know that might be interested in the business? Jeff replied he had several companies in mind to include in the bidding process. These companies would surely come in at a lower price, partly because they used lower-grade boxes that would probably work well enough in Coastal Products process. Jeff also explained that these suppliers were not serious contenders for the business. Their purpose was to create competition with the bids. Ben told Jeff to make sure that Southeastern was well aware that these new suppliers were bidding on the contract. He also said to make sure the suppliers knew that price was going to be the determining factor in this quote, because he considered corrugated boxes to be a standard industry item. As the Marketing Manager for Southeastern Corrugated, what would you do upon receiving the request for quotation from Coastal Products?
Please anwser one of the following. Undergraduate courses: 350 – 500 words or 1 – 2 pages. All work must be free of any form of plagiarism. Put written answers into your own words. Do not simply cut and paste your answers from the Internet and do not copy your answers from the textbook. Be sure to refer to the course syllabus for more details on plagiarism and proper citation styles.1. J.B. Corporation is considering the purchase of equipment that has an invoice price of $450,000. The equipment was recommended by a consulting rm that did an analysis for J.B. Corporation. J.B. paid the consulting rm $12,000 for its report. The cost of shipping and installation is $50,000. The equipment will be depreciated on a straight-line basis over its useful life of 10 years, assuming no salvage value. The equipment will replace existing assets that have a current book value of $100,000 and which could be sold for $150,000. Additional net working capital of $15,000 will be required to…
Papaya Partners is a distributor of papayas. They purchase papayas from individual growers and package them in 10-pound cartons for delivery to their various customers, generally supermarkets. Last month, they budgeted to sell $500,000 worth of cartons at a price of $25 each. Actual sales met a budget of $500,000 at $25 per carton. The management has received cost information based on actual performance and needs to understand the drivers of the overall variance from the budget. They have asked you, as an analyst in their management accounting department, to calculate and explain the variances. The following data has been provided: Budget Cost of fruit @ 10 pounds per carton $ 200,000 Cost of packaging @ 1 pound per carton $ 10,000 Labor costs @ .5 hourse per carton $ 90,000 Total Cost $ 300,000 Actual Cost of fruit @ 10 pounds per carton $ 244,200 Cost of packaging @ .55 pound percarton$ 11,000 Labor costs @ .75 hourse per carton $ 150,000 Total Cost $405,200 WHAT IS THE STANDARD COST…
As an operations management consultant, you have been asked to evaluate a furniture manufacturer’s cash-to-cash conversion cycle under the following assumptions: sales of $23.5 million, cost of goods sold of $20.8 million, 50 operating weeks a year, total average on-hand inventory of $2,150,000, accounts receivable equal to $2,455,000, and accounts payable of $3,695,000. What do you conclude? What would be the impact of reducing the accounts payable from $3,695,000to $2,000,000 and all other data remained the same?
Joel is the RM for the City Center Plaza hotel. He knows that under his franchise agreement, he pays an 8 percent franchise fee and 3 percent marketing fee on all revenue generated from room sales. Additional fees for using the hotel’s CRS are $2.00 per each room reserved. Internet service provider (IDS) related charges paid by the hotel for rooms sold through Internet sites including uberhothotels.com are $10.00 per room sold. Given this information, help Joel complete the revenue estimate worksheet presented below. Net ADR Yield Estimate Worksheet: City Center Plaza Distribution Channel Group rooms Third-party merchant Rooms sold 80 100 Standard rate $185 $160 Gross revenue Franchise fee (8%) Franchise marketing fee (3%) Franchisor's CRS fee ($2 per room) IDS fee Net total revenue Net ADR yield
You are selling a new line of T-shirts on the boardwalk. The selling price will be $25 per shirt. The labor cost is $5 per shirt. The administrative costs of operating the company are estimated to be $60,000 annually, and the sales and marketing expenses are $20,000 a year. Additionally, the cost of materials will be $10 per shirt. What is the break-even quantity? Multiple Choice 2,000 shirts 3,200 shirts 5,334 shirts 8,000 shirts 16,000 shirts
Hi there can you please assist on the following questions below You have been recently appointed as a Purchasing Manager at Unilever. The director hasmentioned that the organisation has recently been experiencing uncertainty in demand and thereis currently no available capacity. As such, he is unsure whether he should make or buy the newrange of cleaning detergents.The Director has requested you as a purchasing manager to do thorough research, and in a report, reflect on the following Discuss at least two circumstances favouring buying (outsourcing) and at least twocircumstances favouring making (insourcing). • Based on your discussion of the circumstances favouring outsourcing and insourcing as wellas the restrictions outlined by the Director, identify whether the cleaning detergents shouldbe outsourced or insourced. Justify your answer by discussing at least two key points.• Identify any two potential drawbacks that Unilever could face given their choice of sourcingmethods.
A manufacturing company has entered into a new contract with a major supplier of raw materials used in the manufacturing process. Under the new arrangement, called vendor managed inventory, the supplier manages its raw material inventory inside the manufacturer’s plant, and only bills the manufacturer when the manufacturer consumes the raw material. How is this likely to affect the manufacturer’s inventory turnover ratio?
Betty, the chief of nursing executive, need to make a decision about buying 340 new hospital beds for patient rooms. After she interviewed nurse managers at the units where the beds were going to be placed, Betty compiled her findings and decided to contact a well-known equipment company to obtain prices and a bid. No bids from other companies were obtained. The equipment company’s executive salesperson, Jim, discussed options at length with her and invited her and her significant other to an upcoming all-expense-paid, lavish junket at a five-star hotel in Hawaii to see demonstrations of the beds and experience a comprehensive sales program. Betty thought, “We badly need some relaxations and stress relief. Hawaii would be so much fun. Would it be wrong for us to go? If you were Betty, what would you do? Justify your answer with ethical framework: theory, approach or principle. Discuss the ethical principles at stake. What breaches are possible? Do you consider this situation a conflict…