ABC Beverage, LLC, purchases its 355-ml cans in large bulk from Wald-China Can Corporation. The finish on the anodized aluminum surface is produced by mechanical finishing technologies called brushing or bead blasting. Engineers at Wald are switching to more efficient, faster, and cheaper machines to supply ABC. Use the estimates and MARR = 12% per year to select between the two alternatives. Brush Alternative Bead Blasting Alternative $-300,000 $-300,000 In 8 years $50,000 $-80,000 in year 1, decreasing by $3000 annually starting in year 2 large Salvage Value AOC Nonlabor no value $-62,000 per year The (Click to select) v is selected by the company.

ABC Beverage, LLC, purchases its 355-ml cans in large bulk from Wald-China Can Corporation. The finish on the anodized aluminum surface is produced by mechanical finishing technologies called brushing or bead blasting. Engineers at Wald are switching to more efficient, faster, and cheaper machines to supply ABC. Use the estimates and MARR = 12% per year to select between the two alternatives. Brush Alternative Bead Blasting Alternative $-300,000 $-300,000 In 8 years $50,000 $-80,000 in year 1, decreasing by $3000 annually starting in year 2 large Salvage Value AOC Nonlabor no value $-62,000 per year The (Click to select) v is selected by the company.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Muscat Inc. has been manufacturing its own Camera for its Mobile Phone. The company is currently operating at 100% of capacity. Variable manufacturing overhead cost is OMR 3 per unit. The direct materials and direct labor cost per unit to make the camera are OMR 4 and OMR 6, respectively, fixed cost is OMR 50,000. Normal production is 50,000 Mobile Phone per year. A supplier offers to make the Cameras at a price of OMR 13.50 per unit. If Muscat accepts the supplier's offer; all variable manufacturing costs will be eliminated, but the OMR 50,000 of fixed manufacturing overhead currently being charged to the Cameras will have to be absorbed by other products. what will be the effect on net income? if the productive capacity released by not making the Cameras could be used to produce income of R.O. 40,000 Select one: O a. OMR 15,000 increase O b. None of the answers are correct Oc.OMR 25,000 decrease O d. OMR 15,000 decrease e. OMR 725,000 increase
Allen Corporation currently makes the nylon convertible top for its main product, a fiberglass boat designed especially for water skiing. The costs of producing the 1,500 tops needed each year follow: Nylon fabric Aluminum tubing Frame fittings Direct labor Variable manufacturing overhead Fixed manufacturing overhead $270,000 96,000 24,000 162,000 30,000 180,000 Dustin Company, a specialty fabricator of synthetic materials, can make the needed tops of comparable quality for $390 each, F.O.B. shipping point. Allen would furnish its own trademark insignia at a unit cost of $12. Transportation in would be $18 per unit, paid by Allen Corporation. Allen's chief accountant has prepared a cost analysis that shows that only 20% of fixed overhead could be avoided if the tops are purchased. The tops have been made in a remote section of Allen's factory building, using equipment for which no alternate use is apparent in the foreseeable future. a. Prepare a differential analysis showing whether or…
please no excel!! please show all work and calculations thank you
I need an answer for number 1, please, thank you!
Parker Pottery produces a line of vases and a line of ceramic figurines. Each line uses the same equipment and labor; hence, there are no traceable fixed costs. Common fixed cost equals $40,000. Parker's accountant has begun to assess the profitability of the two lines and has gathered the following data for last year: VasesFigurinesPrice$40$70Variable cost3042Contribution margin$10$28Number of units1,000500 Required: If required, round your final answers to nearest whole value. 1. Compute the number of vases and the number of figurines that must be sold for the company to break even. Break-even vasesfill in the blank 1 unitsBreak-even figurinesfill in the blank 2 units 2. Parker Pottery is considering upgrading its factory to improve the quality of its products. The upgrade will add $5,260 per year to total fixed cost. If the upgrade is successful, the projected sales of vases will be 1,500, and figurine sales will increase to 1,000 units. What is the new break-even point in…
2. What revenue would the sale of the breakeven quantity for $5.50 per gallon generate? IceLess is an anti-icing solution sold in gallon plastic jugs. It is poured into the windshield washer bottle of your car. Wash your windshield and the solution prevents the glass from icing over for about four hours. Production incurs the following fixed and variable costs. It is priced initially at $5.50 per gallon. Fixed costs (per year) Variable Costs per gallon Rent: $18000 Glycol: $1.50 Utilities: 13200 FreezeFree 312: .50 Managerial salaries: 20000 Mfg labor: .20 Flammability permit: 12000 Packaging: .20 Other fixed expense: 2400 Inert ingredients: .60 Total fixed: $65600 Advertising: .30 Total: $3.30
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Dexcon Technologies, Inc., is evaluating two alternatives to produce its new plastic filament with tribological (i.e., low friction) properties for creating custom bearings for 3-D printers. The estimates associated with each alternative are shown below. Using a MARR of 15% year, which alternative has the lower present worth? per Method DDM LS First Cost $-200,000 $-40,000 $-500,000 M&O Cost, per Year $-40,000 Salvage Value Life $2,000 $21,000 2 years 4 years The present worth for the DDM method is $ The present worth for the LS method is $ The (Click to select) v method is selected.
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Laser Cast Inc. manufactures color laser printers. Model J20 presently sells for $325 and has a product cost of $260, as follows: Line Item Description Amount Direct materials $190 Direct labor 50 Factory overhead 20 Total $260 It is estimated that the competitive selling price for color laser printers of this type will drop to $310 next year. Laser Cast has established a target cost to maintain its historical markup percentage on product cost. Engineers have provided the following cost-reduction ideas: 1. Purchase a plastic printer cover with snap-on assembly, rather than with screws. This will reduce the amount of direct labor by 9 minutes per unit.2. Add an inspection step that will add six minutes per unit of direct labor but reduce the materials cost by $7 per unit.3. Decrease the cycle time of the injection molding machine from four minutes to three minutes per part. Thirty percent of the direct labor and 45% of the factory overhead are related to running injection…
Cabin Creek Company is considering adding a new line of kitchen cabinets. The company's accountant provided the following estimated data for these cabinets: Annual sales Selling price per unit Variable manufacturing costs per unit Variable selling costs per unit Incremental fixed costs per year: 800 units. $ 3,680 $ 1,680 $ 530 $ 493,400 Manufacturing Selling Allocated common costs per year: Manufacturing Selling and administrative $ 73,000 $ 98,000 $ 130,000 If the kitchen cabinets are added as a new product line, the company expects that the contribution margin earned from selling products will decrease by $236,000 per year. Required: 1. What is the annual financial advantage (disadvantage) of adding the new line of kitchen cabinets? 2. What is the lowest selling price per unit that could be charged for the cabinets and still make it economically desirable for th company to add the new product line? Complete this question by entering your answers in the tabs below. Required 1…
Crane Company manufactures dog food for distribution in Washington, Oregon, and California. A dog food distributor from Florida has approached Crane and offered to purchase 264000 pounds of dog food for $1.40 per pound. Crane can produce 2048000 pounds of dog food per year, and its results for last year are as follows: Sales (1844000 at $1.65) Variable costs Contribution margin Fixed costs Operating income $3042600 O $1392800 O $1336400 O $2084400 O $1270400 1106400 1936200 814000 $1122200 If Crane accepts the offer, it will only be able to sell 1784000 pounds of dog food at the regular price due to its capacity constraints. What will Crane's total operating income be next year if it accepts the offer?

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