A) Should Coronation make or buy the tubes? If they should buy then w maximum acceptable purchase price? B) Instead of sales of 100,000 boxes, revised estimates show sales of 1: boxes. This new volume requires the company to rent additional equ an annual rate of $10,600 to manufacture the tubes. This is the only a fixed cost even if sales increase to 300,000 boxes (300,000 productio goal for the third year). With this, should Coronation make or buy the C) The company has the option of making and buying at the same time. would be your answer to part (c) if this alternative is considered?
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- After considerable research, a winter products line has been developed. However, Silven's president has decided to introduce only one of the new products for this coming winter. If the product is a success, further expansion in future years will be initiated. The product selected (called Chap-Off) is a lip balm that will be sold in a lipstick-type tube. The product will be sold to wholesalers in boxes of 24 tubes for $11 per box. Because of excess capacity, no additional fixed manufacturing overhead costs will be incurred to produce the product. However, a $99,000 charge for fixed manufacturing overhead will be absorbed by the product under the company's absorption costing system. Using the estimated sales and production of 110,000 boxes of Chap-Off, the Accounting Department has developed the following manufacturing cost per box: Direct material Direct labor Manufacturing overhead Total cost $ 5.10 3.40 2.30 $ 10.80 The costs above relate to making both the lip balm and the tube that…As a recent hire of B-Well, your job is to evaluate whether the company should open a traditional grocery store in Astoria or start online shopping option instead. Before deciding which project to undertake, the Board of Directors has already agreed that they will hire a consultant to verify their decision. The consultant is charging $16, 580 total. They have also agreed that they will hire an NYC marketing agency to promote B-Well's reputation. They are not sure what the charge will be for the marketing services. For now, they just have to decide which project they will undertake. Brick & Mortar Store. B-Well Health Mart has to rent and renovate a space in Astoria. The estimates for the up-front renovation costs range from $2,250,000 to $2,650,000 to be depreciated over the life of the project using straight-line with a zero salvage value. There is a foreclosed warehouse in the area that their lenders are offering at a large discount since the lenders are losing money on it. The…After considerable research, a winter products line has been developed. However, Silven's president has decided to introduce only one of the new products for this coming winter. If the product is a success, further expansion in future years will be initiated. The product selected (called Chap-Off) is a lip balm that will be sold in a lipstick-type tube. The product will be sold to wholesalers in boxes of 24 tubes for $9 per box. Because of excess capacity, no additional fixed manufacturing overhead costs will be incurred to produce the product. However, a $105,000 charge for fixed manufacturing overhead will be absorbed by the product under the company's absorptlon costing system. Using the estimated sales and production of 150,000 boxes of Chap-Off, the Accounting Department has developed the following manufacturing cost per box: Direct material Direct labor $ 4.10 2.40 Manufacturing overhead 1.80 Total cost $ 8.30 The costs above relate to making both the lip balm and the tube that…
- The cost of introducing the products in selected geographic areas for gauging consumer response is $150K. If the company decides to introduce the product this way, it would need to see the responses to the products before they decide to launch the product line nationally. The probability of a favorable response in the selected geographical areas is estimated at O.60. La Comida can also decide not to go for the launching in the product in selected geographical areas and go ahead with the nationwide launch or not. If La Comida Foods decides to go full-blast in launching the products nationally and are a success, the company estimates that they will gain an annual income of $1.6 million. If the products are not a hit, the company will realize losses to the tune of $700K. La Comida estimates the probability of success for the sauces and marinades to be 0.50, if these are introduced without gauging consumer response.Kroft Food Products is attempting to decide whether it should introduce a new line of salad dressings called Special Choices. The company can test market the salad dressings in selected geographic areas or bypass the test market and introduce the product nationally. The cost of the test market is $150,000. If the company conducts the test market, it must wait to see the results before deciding whether to introduce the salad dressings nationally. The probability of a positive test market result is estimated to be 0.6. Alternatively, the company can decide not to conduct the test market and go ahead and make the decision to introduce the dressings or not. If the salad dressings are introduced nationally and are a success, the company estimates that it will realize an annual profit of $1.6 million, whereas if the dressings fail, it will incur a loss of $700,000. The company believes the probability of success for the salad dressings is 0.50, if they are introduced without the test market.…Please provide the answer in excel with the formulas and explain he steps. The are three questions below. The bullets are the information needed to answer and solve the questions. Medical Center Hospital CEO Thomas Cleverly decided that the not-for-profit hospital needed a new revenue line to help it compete with other hospitals in the area. He envisioned a mobile medical clinic, called “Health Train,” which could travel to different neighborhoods and provide annual physical examinations for a low price. You are an MHA fellow who is assigned to the CEO’s office, and the task of doing the initial planning for this project has fallen on your shoulders. You have been able to gather the following information on the Health Train concept: An appropriate-sized bus can be purchased for $300,000; it would have a ten-year life and a 10 percent salvage value. Equipment for the bus would cost $100,000; it would have a five-year life with no salvage value. A physician to staff the Health Train…
- . Refresh Resorts, Inc., operates health spas in Key West, Florida; Phoenix, Arizona; and Carmel, California. The Key West spa was the company’s first and opened in 1991. The Phoenix spa opened in 2004, and the Carmel spa opened in 2013. Refresh Resorts has previously evaluated divisions based on RI, but the company is considering changing to an EVA approach. All spas are assumed to face similar risks. Data for 2017 are: Q.How does the selection of asset measurement method affect goal congruence?. Refresh Resorts, Inc., operates health spas in Key West, Florida; Phoenix, Arizona; and Carmel, California. The Key West spa was the company’s first and opened in 1991. The Phoenix spa opened in 2004, and the Carmel spa opened in 2013. Refresh Resorts has previously evaluated divisions based on RI, but the company is considering changing to an EVA approach. All spas are assumed to face similar risks. Data for 2017 are: Q. Why might Refresh Resorts want to use EVA instead of RI for evaluating the performance of the three spas?Khair Ltd carries out research and development on a continuousbasis. The directors of the company are passionate aboutimproving their medicinal drugs and finding new cures.In the current financial year, the company has been makingsignificant findings regarding a vaccine for the coronavirus. To thiseffect, they have registered a patent for a new vaccine that willsoon be available to customers. The following costs have beenincurred in respect of the patent in the current financial year.Research salaries R250 000Development salaries R450 000Initial marketing costs R30 000Fees to register patent R78 000Materials used in development R12 000The development was completed on 1 July 2020.Patents are amortised on a straight‐line basis at 20% per annumwith no residual value.Prepare the journal entry to recognise the patent in the financialstatements of Khair Ltd on 1 July 2020.Narrations are required
- . Refresh Resorts, Inc., operates health spas in Key West, Florida; Phoenix, Arizona; and Carmel, California. The Key West spa was the company’s first and opened in 1991. The Phoenix spa opened in 2004, and the Carmel spa opened in 2013. Refresh Resorts has previously evaluated divisions based on RI, but the company is considering changing to an EVA approach. All spas are assumed to face similar risks. Data for 2017 are: Q.Refer back to the original data. Calculate EVA for each of the spas, using net book value of long-term assets. Calculate EVA again, this time using gross book value of long-term assets. Comment on the differences between the two methods.Refresh Resorts, Inc., operates health spas in Key West, Florida; Phoenix, Arizona; and Carmel, California. The Key West spa was the company’s first and opened in 1991. The Phoenix spa opened in 2004, and the Carmel spa opened in 2013. Refresh Resorts has previously evaluated divisions based on RI, but the company is considering changing to an EVA approach. All spas are assumed to face similar risks. Data for 2017 are: Q.Calculate RI for each of the spas based on operating income and using total assets as the measure of investment. Suppose that the Key West spa is considering adding a new group of saunas from Finland that will cost $225,000. The saunas are expected to bring in operating income of $22,000. What effect would this project have on the RI of the Key West spa? Based on RI, would the Key West manager accept or reject this project? Without resorting to calculations, would the other managers accept or reject the project? Why?The owner of Barb’s Burgers has suggested the firm should invest in more moderntechnology and created a list of potential changes she thinks may be helpful as aninvestment. She has asked you to analyze the four potential choices and comment onwhat this would change in terms of cost: Allow Barb’s Burgers to be delivered via the pre-existing food delivery systems.For example, allow people from Doordash/Uber Eats to pick-up orders and deliverthem. This would require the firm to make some minor changes and result in fewerparking spaces for customers dining at the restaurant. • Question: Argue how each of these is likely to change the cost of the firm once implemented (i.e. are any of these a fixed cost or a variable cost). How this adjust the amount of labour and/or capital currently necessary for the firm? Would the technology be a general technology, labour-saving, or capital-saving? Also mention the parking space.