Question #1Consider the following information, prepared based on a monthly capacity of 500,000 units:CategoryCost per Un...

Get help with any kind of assignment - from a high school essay to a PhD dissertation

  1. Order Custom Essay, Course Work, Research and Term Papers

Consider the following information, prepared based on a monthly

April 14, 2018

Question #1

Consider the following information, prepared based on a monthly capacity of 500,000 units:

Category

Cost per Unit

Variable manufacturing costs

$21

Fixed manufacturing costs

$4

Variable selling costs

$5

Fixed selling costs

$3

Capacity cannot be added in the short run and the firm currently sells the product for $43 per unit.

The company is currently producing 440,000 units per month. A potential customer has contacted the firm and offered to purchase 50,000 units this month only. The customer is willing to pay $36 per unit. Since the potential customer approached the firm, there will be no variable selling costs incurred. Should the company accept the special order? Why or why not? Be specific.


b) Assume the same facts as in part a, except that the company is producing 500,000 units per month. Should the company accept the special order? Why or why not? Be specific.


c) List and describe other factors (not those addressed in parts a and b) that should be taken into consideration when deciding whether to accept a special order? Be specific in your responses.



Question #2

Consider the following information, prepared based on monthly production and sales of 100,000 units:

Category

Cost per Unit

Variable manufacturing costs

$45.00

Variable marketing costs

$12.00

The firm has total fixed costs of $3,000,000 and currently sells the product for $120 per unit.

Assume the company is producing and selling 100,000 units per month. It is considering an arrangement where an outside manufacturer would produce and ship the product directly to customers. Under this arrangement, variable marketing costs would decrease 70% per unit and $2,100,000 in fixed costs would be avoided. What is the maximum amount per unit the company would be willing to pay to the outside manufacturer?

List and describe other factors that should be taken into consideration when deciding whether to accept this offer. Be specific in your responses.


Question #3

A consulting company performs a “basic” market analysis for a client. It incurs costs of $100,000 in performing the analysis and plans to sell the report to the client for $250,000. After reviewing the initial report, the client asks the firm if it is willing to do a more extensive report. The client offers to pay $450,000 for a more extensive report. If the more extensive report is done, the client will NOT pay the $250,000. If the consulting firm estimates it will require $210,000 in additional expenses to complete the more extensive report, should it agree to do the more extensive report? Why or Why not? Be specific in your response.


Question #4

Assume an engineering company provides services for three types of clients. Each service requires a different amount of a specific form of specialized labor that is in limited supply. If the company is limited to 12,000 hours of this specialized labor, how many clients of each type should it accept in order to maximize operating income?

Client Type

A

B

C

Revenue per client

$1,700

$3,800

$5,300

Variable costs per client

$800

$1,400

$2,700

Specialized labor hours required per client

6

15

20

Maximum clients available

800

600

200










OUR SERVICE CHARTER






  • Excellent Quality Work

    Grammar is one of the elements that we take seriously in our service delivery. Beside the use of spell checkers, we progressively take our writers through the essentials of a quality paper that features information clarity. Importantly, we encourage our writers to avoid coming up with a paper that deviates from the elements that appear on the client’s instruction brief. It means that the papers that we deliver denote well researched information that is rich in details. Additionally, the papers usually contain exhaustive details on any instruction that a client submitted. It is the tireless application of our writers’ efforts that makes us stand out when it comes to the delivery of excellent quality work. Notably, our writers use quality resources when digging up information that a paper requires. They are usually aware of the sources that contain rich information. Our past clients have proved that we give nothing short of quality work through giving us a positive feedback.

  • Better Grades Guarantee

    Our team of writers prides in high-level competence. The writers have the required expertise that enables them to deliver quality papers that match with the requirements of the grading rubric. In the absence of the rubric, we ensure that the writers follow the clients’ instruction brief to the letter. We can confidently assure our clients to expect nothing short of a pass from the papers that we deliver. Importantly, we have qualified writers who handle different areas of study. This diversification enables us to allot clients’ orders to the writer who is well seasoned in the subject area of study. It also enables the team to become more professional due to specialization. Our clients should put their trust in our service delivery and expect to successfully attain high grades at all times. The fact that we offer free revision reflects our dedication in delivering high quality papers that match with our clients’ expectations.

  • 100% Confidentiality

    We mind about the interests of our clients holistically. It is for this reason that we maintain high-level confidentiality in regard to our clients’ personal information. Importantly, we use the information for purposes that relate with our services only. The only information that we require relates to our clients’ writing needs. It is also important to note that our clients’ payment information is secure with us. If there is any query in regard to the payment information, then our support team is always willing to provide any clarifications in a prompt manner. Confidentiality extends to the fact that a client made use of our services. It means that we hold our relationship with our clients in secrecy. Importantly, our confidentiality measures beat any advanced security measure that can identify any information regarding our relationship with our clients. It means that our clients transact with us freely without any fear of information leakage.

  • 24/7 Customer Support

    Our team of writers prides in high-level competence. The writers have the required expertise that enables them to deliver quality papers that match with the requirements of the grading rubric. In the absence of the rubric, we ensure that the writers follow the clients’ instruction brief to the letter. We can confidently assure our clients to expect nothing short of a pass from the papers that we deliver. Importantly, we have qualified writers who handle different areas of study. This diversification enables us to allot clients’ orders to the writer who is well seasoned in the subject area of study. It also enables the team to become more professional due to specialization. Our clients should put their trust in our service delivery and expect to successfully attain high grades at all times. The fact that we offer free revision reflects our dedication in delivering high quality papers that match with our clients’ expectations.




Related Questions