Loose Leaf for Cost Management: A Strategic Emphasis
Loose Leaf for Cost Management: A Strategic Emphasis
8th Edition
ISBN: 9781260165180
Author: BLOCHER, Edward; Stout, David F.; Juras, Paul; Cokins, Gary
Publisher: McGraw-Hill Education
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Chapter 17, Problem 42E

1.

To determine

Calculate the approximate value of k using Taguchi quality loss function (QLF).

2 a. and b.

To determine

Calculate the estimated quality loss for each of the observed measurements and calculate the expected loss per unit (to 2 decimal places) for the production process as a whole.

3 a.

To determine

Calculate the square of the deviation of the mean of the actual x-values from the targeted value, T.

3 b.

To determine

Compute the variance of the observed values of the quality characteristic x around the mean value of x.

3 c.

To determine

Calculate the expected (average) per unit loss of the process.

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L.L. Bean operates two factories that produce its popular Bean boots (also known as "duck boots") in its home state of Maine.  Since L.L. Bean prides itself on manufacturing its boots in Maine and not outsourcing, backorders for its boots can be high. In 2014, L.L. Bean sold about 450,000 pairs of the boots. At one point during 2014, it had a backorder level of about 100,000 pairs of boots. L.L. Bean can manufacture about 2,200 pairs of its duck boots each day with its factories running 24/7. In 2015, L.L. Bean expects to sell more than 500,000 pairs of its duck boots. As of late November 2015, the backorder quantity for Bean Boots was estimated to be about 50,000 pairs. Question:  1. Assume that 5% of the L.L. Bean boots are returned by customers for various reasons. L. Bean has a 100% refund policy for returns, no matter what the reason. What would the journal entry be to accrue L.L. Bean's sales returns for this one pair of boots? (Note: L.L. Bean most likely will make…
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