...first year of business, determine the amount of variable and fixed costs associated with utilities and maintenance using the high-low method for each. Hi-Lo Maintenance | Units | Cost | September | 8,000 | $1,914.00 | January | 2,000 | $1,716.00 | Difference | 6,000 | $198.00 | Cost/unit | | $0.03 | | | | | | | Hi-Lo Utilities | Units | Cost | September | 8,000 | $1,400.00 | January | 2000 | $1,100.00 | Difference | 6,000 | $300.00 | Cost/Unit | | $0.05 | | | | January Sales | 12000 | | January /unit cost | 16 | | January Units | 750 | | | | | Maintenance Cost January | Units | 750 | | Cost/unit | $0.03 | | Total Variable Costs | $24.75 | | | | Utilities Cost January | Units | 750 | | Cost/Unit | $0.05 | | Total Variable Costs | $37.50 | 3. Using the format below, prepare a Sales Budget for the year ending 2008. Sweats Galore | Sales Budget |...
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...use. Organizations operating fleets of vehicles or paying employee allowances for personal vehicles should contact Runzheimer International for information regarding their services. www.runzheimer.com Vehicle Expenses National Average Costs Average Annual Operating Costs Average Annual Ownership Costs Annual Driving Costs How to Calculate Your Vehicle Expenses Your Vehicle and Your Business 3 4 4 5 6 8 11 C A N A D I A N A U T O M O B I L E A S S O C I AT I O N Driving Costs 2011 2 Driving Costs 2011 Beyond the price tag: Understanding your vehicle’s expenses Whether you buy new or used, there’s more to the cost of your vehicle than the purchase price. Fuel, maintenance, depreciation—all kinds of factors add to your total cost of ownership. Since transportation is an average household’s second largest expense, it makes sense to get the full picture of what you’re spending each year to keep your vehicle on the road. That’s why the Canadian Automobile Association developed this booklet. By giving national averages and approximate figures as guidelines, Driving Costs helps you make the calculations you need to build an accurate transportation budget. VEHICLE EXPENSES All the average costs we’ve cited are for vehicles operating under mostly stop-and-go driving conditions. Costs are weighted by the population of each province to establish a nationwide composite average value, and are calculated using figures available as of December 2010 except for fuel costs...
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...Competition Bikes Budgeting and Variance Analysis Report Western Governor’s University Competition Bikes Budgeting and Variance Analysis Report Competition Bikes, Incorporated (Inc.) makes bicycles for professional and other highly accomplished riders who compete in bike races, biathlons, and triathlons. Approximately sixty percent of all race winners have been victorious using bicycles designed by Competitions Bikes, Inc. This extraordinary success rate is a topic of conversation among racers and has led to exponential success for founder Larry Ferguson who formed the company in 2001 in his garage. Competition Bikes is known for quality products and is leader in the market with the CarbonLite products they provide. These results are transparent in the budgets from the last few years; however, the most recent budget contained several unfavorable variances that may be an indication that some changes are needed. Budget planning, identifying unfavorable variance, and correcting those variances can make or break the financial position of a company. The following is a summary report that discussed budgetary areas that raise concern in budget planning; evaluates the flexible budget and its variance; recommends corrections actions for areas of concern based on the variance analysis; and discusses how the concept of management by exception could be applied to the variances. Budget Planning, Allocation of Resources, and Management Control ...
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...Unit 3: Albatross Anchors Assignment Jacob Barac MT435 Operations Management Kaplan University November 26, 2012 Albatross Anchors Assignment Introduction Albatross Anchors is a family- owned business which was established in 1976, Smalltown, MA in the United States. Albatross Anchor started with four family members, and has largely grown to one hundred and thirty employees. Their operations consist of varies aspects; manufacturer of bell or mushroom anchors. The Albatross Anchors only distributes their products to wholesale, but not retail service provider. Their building consists of administrative offices, foundry, shipping and receiving, raw materials and finished materials storage, and manufacturing. The building is not in good standards and would rather need remolding. In this case study, I will discuss how to improve Albatross Anchor competitiveness by adding some new process to help bring down the costs of remolding their building to meet the United States environmental ethic laws. Question One Based on the information presented in the scenario/case study discuss Albatross Anchor’s competitiveness in relation to (please address all items in the below list and provide support for your conclusions): 1. Cost a) Cost of Production: Since Albatross Anchor keeps all departments in one building; this keeps the fixed cost down, and lowers expenses in term of variable cost. The cost of manufacturing for the mushroom/bell anchors are $8.00 per pound and $11...
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...be explaining what the words budget, fixed, variable and total costs mean. One of the main topics that I will be covering is the fact that if Brad does nothing with his costs what the implication would be on the business as well as him and what encounters it will have. Budget: So what is budget? Budget is a financial document which is used to project future income and expenses. Budgeting is used by everyone who owns a business whether it’d be a large or small business; it is a crucial part of the finance side of the business. The process may be carried out by individuals or by companies to estimate whether the company is keeping within their budget and not over spending. The process for preparing a monthly budget includes: * Listing of all sources of monthly income. * Fixed expenses such as rent/mortgage, utilities, phone bills. * Listing of other possible and variable expenses. A business will always choose how much they are to spend on their resources etc from their budget which is calculated when the business starts. A budget may be prepared simply using paper and pencil, or on computer using a spreadsheet program like Excel. Fixed: Fixed cost is a cost that does NOT change even if there is an increase or decrease amount of good or service produced. Fixed costs are classed as expenses that have to be paid by the company which never changes. The cost is one of the two components of the total cost of a good or service, along with variable cost. For...
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...if any. * Reduce service hour from 24 hour to 2 shift per day. Question1 Solution * Non-cancelable leases on computer equipment havefour more years to run. * If Prestige shuts down the subsidiary it needs tooutsource data services from an outside vendor almost double the cost to present system. * Add back the depreciation (non-cash) the net lossconvert into profit in the month of March. * $800 per hour is acceptable price. * Opportunity costs rather than reported or historicalcosts should be used. And Prestige Data Services isnot really a problem to Prestige Telephone Co. * Reported cost includes total cost i.e. variable costand fixed cost. But in decision making only variablecost will be considered. * Reported Costs $160413 * Relevant Costs $61860 Question 2 Solution Break Even Point-Total Cost = Total Revenue January February March 231513-82000 229925-82000 233723-82000 $800 $800 $800 = 187 hours =185 hours =163hours Question 3 Solution a)...
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...Exercise 1 Question 1 a. Microeconomics b. Macroeconomics c. Macroeconomics d. Microeconomics e. Macroeconomics Question 2 Given the graph of the production possibilities frontier, the main source of milk and ingredient of cookies are from cows. If the milk production is to be increased, the production of cookies will decreased, illustrated by the movement of quantity of milk and cookies produced, from point A to B. This is based on the opportunity cost applied in this situation. If the population of the cows grows, the economy in this industry grows along as well, and the producers are able to produce more cookies and milk, illustrated from the shift from point B to C. If the disease kills half of the population of the cows, the productivity level decreases, as the source now are limited. This results in a lower production for both products, illustrated with the shift from point B to D. Question 3 a. | | The demand of the orange juice increases, illustrated by the shift of the demand curve from D1 to D2. This causes the price of the orange juice rises from P1 to P2. | | | | b. | | As New England turns warm, people prefer to go there rather than the Caribbean. This causes the quantity demand for the resort in the Caribbean to fall, from Q1 to Q2, which resulted in the price of the hotel rooms in the Caribbean to fall as well. | | | | c. | | The supply of gasoline decreases as the war breaks, from...
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...Midterm Case Analysis — Document Transcript 1. Paige Rudolph MKT 463 Midterm April 30, 2003 Augustine Medical, Inc. Case Analysis Company Background In July 1987, Dr. Scott Augustine, an anesthesiologist, founded Augustine Medical, Inc. (AM) in Minnesota. Their goal was to develop and market products for hospital operating rooms and postoperative recovery rooms. Through experience, he discovered that hospitals needed an innovative approach to warming post-surgery patients. Dr. Augustine developed the Bair Hugger® Patient Warming System. Company executives were occupied with finalizing the Bair Hugger® Patient Warming System in early 1988. Original two products: (1) produce and sell patented warming system used to treat hypothermia and postoperative patents, (2) tracheal intubation guide for crisis situations and in the surgical room. Core Competencies Providing the most innovative and safe way to warm postoperative patients and those with hypothermia. Augustine Medical, Inc.’s products are also more effective, less likely to leak water onto expensive equipment, and easier to operate than other competitors methods of hearing patients. The Hospital Market Approximately 21 million surgical operations are performed annually in the US. That’s 84,000 operations per average 8-hour workday. Approximately 5,500 hospitals have operating rooms and postoperative recovery rooms. Research commissioned by AM indicated that there are 31,365 postoperative recovery beds and...
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...The Scars of War Lou Hampton United States History 1763-1877 September 18, 2012 During the 1840s and 1850s, great change was coming to America. Northerners lived in a world of change in which they hardly understood. Their confusions and anxieties of that world made them ready for conflict. However, it was not completely clear what they were fighting for. The war wiped away their confusions and revealed to them where they stood and defined what kind of people they might be. Social and economic changes were happening as the North headed toward war. The economy accelerated, increased output, generated more wealth, moved products and people at faster speeds, transmitted information more rapidly and linked distant places by rail, telegraph and newspapers. New inventions, industries and products had sprung to life. The population multiplied six fold and the amount and size of cities were continuing their growth. There were 400 places with over 2,500 people. Swelling its possibilities, the nation expanded in size when in 1845 Texas joined the Union. Another factor in the nation’s growth was in 1846 when the Oregon territorial boundary was settled. The sudden economic growth was not as beneficial as it seemed. Per capita wealth was growing but there was a decline in actual wages. The North controlled about 92 percent of the wealth. This helped fuel sectionalism because the Southerners became afraid that they would lose their own culture and power in Congress. This...
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...profit, which is from a combination of not pricing his products correctly and spending too much on costs. I first figured out his total revenue for the year. Giberson’s year is actually made up of 40 weeks or ten months. The following table is what makes up his revenues: Category | Unit Price | # of units | Sales | Patterned glasses | $9.00 | 19*40=760 | $6840 | Paperweights | $15.00 | 10*40=400 | $6000 | Wrapped tumblers | $8.00 | 32*40=1280 | $10,240 | Vases | $25.00 | 8*40=320 | $8000 | Total Annual Revenue: | =31,080 | I then calculated the operating costs for the year, which included his estimated wages of $25,000 for the year and depreciation of the equipment, furnace, truck, and gas tanks. I combined the remaining operating costs together which include advertising, rent, utilities, etc.: Category | Cost per month | Months (40/52)*12 | Operating Costs | Office Supplies | $25 | 9.23 | $231 | Hand Tools/MFG supplies | $150 | 9.23 | $1,385 | Part-time labor | $100 | 9.23 | $923 | Other operating costs | $640 | 9.23 | $7,680 | Truck | $205 | 9.23 | $2,460 | Furnace | $1,000 | 9.23 | $9,230 | Furnace Depreciation | $208* | 12 | $2,500 | Equipment Depreciation | $31.25** | 12 | $375 | Truck Depreciation | $141.67*** | 12 | $1,700 | Gas tanks depreciation | $4.17**** | 12 | $50 | Salary | $2083 | 12 | $25,000 | Total Operating Costs: | $51,533 | *5000/(2 years*12 months)=208 **3000/(8 years *12 months)=31.25 ***8500/(5 years * 12 months)=141...
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...1. Cost accounting relates to what industry? a. public accounting b. financial accounting c. service d. manufacturing 2.Sunk costs are ______. a. future costs b. costs that do not affect the decision c. costs from the past and cannot be changed. d. choice b & c are both correct 3.Which is not a characteristic of managerial accounting information? a. Emphasizes the external financial statements b. Emphasizes relevance c. Provides detailed information about individual parts of the company d. Focuses on the future 4._ cost driver is _____. a. The secondary factor that causes a cost to increase or decrease based on the cost drivers factor’s usage. b. The primary factor that causes a cost to increase or decrease based on the cost drivers factor’s usage. c. The individual that is driving to and from work this week in the car pool. d. Assigning direct costs to cost objects. 5.Using Figure 1 as a guide, which cost system is used? Figure 1 a. Process Costing b. Job Order Costing c. Service Costing d. Actual Costing 6.When a company announces that it is planning on cutting costs, what usually happens to the company’s stock? a. Nothing b. Goes down in value c. Goes up in value d. Depends on numerous factors 7.Spending on testing a product before shipment to customers is which type of quality cost? a. External failure cost b. Prevention cost c. Appraisal cost d. Test marketing cost 8.Which statement is false? a. An ABC system is more refined than one that uses a...
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...Acknowledgement All the praises for ALLHA Who is most Gracious, beneficent and beloved. It is only ALLHA who gives us knowledge and wisdom to do this task. All respects for Hazrat Muhammad (SAW) Who gives us the recognition our Creator and also leads us to recognize the aim of our creation. We are thankful to the comsats Institute of information technology Lahore for providing us a plat form and base to polish our skills and knowledge through practical experience. We also want to avail this opportunity to express our heart full gratitude and appreciation towards our respected teacher Mr sardar zahid for his interning effort to instill in us spirit of curiosity to gain a firsthand knowledge of the often challenging business word and challenging a business executives often has to come across and how to negotiate and counter such testing time. Executive summery This report provides a brief overview for business person who is interested to making a flour company in market of Lodhran. This report covers all the faces of product development. We have tried our level best to high light all possible factors of a business for example cost benefits, sales, revenue, profit, resources, economic implication, and its future expectation in Pakistan. Some future plans are also discuss briefly under the assumption of smooth flow of economy with political stability. Mission Promote the salt lamps field Objectives • Environment...
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...ANALYSIS OF WESTLAKE LANES As per the case we can get into the solution by analysing 5 alternatives which are given below. Alternatives Alternative 1 Sell business; liquidate all assets to pay liabilities and investors. The Pros for this alternative would be that the business would be able to pay debt owed to investors. Furthermore, when the business closes, Givens and the board can possibly spend their time and energy into another more profitable business model. Givens may even have to work less than 70 hour a week shifts. The Cons to this may be the opportunity cost of making the business profitable and giving the business a chance to make a return on investment. As well, by doing this Givens and the board would be killing the family business, not to mention the job loss of employees. In terms of a financial analysis for this alternative, the liquidations of assets will ensure repayment of all debt. Current net assets ($191,303) less net liabilities ($154,208) will ensure a $37,095 left over. Alternative 2 Keep business and maintain current state of affairs. Continue to scrutinize cost and increase revenues. Add no major investments. The pros for this alternative would be the relatively low risk since the inertia has already been initiated by Givens. Now, Givens or any other manager simply may need to keep it going the way it is going. By keeping the family business alive, Givens and the board would be protecting their employee’s jobs (which would...
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...Unit Three Written Assignment Matthew Snyder MT435 Operations Management Kaplan University November 25, 2013 Introduction Hello Albatross Anchor and thank you for allowing us to come in to your place of business with the efforts to try and assist with your production process. KU Consulting will begin to determine what areas could use a revision in several different areas to make Albatross Anchor a profitable business. In order for us to assist you, we will make some recommendations of the business within your financial boundaries. We are here to assess and deliver a system that will be an all around bonus to your business in providing you with such details. We will begin review process with the administrative side and then lead into the cost of production. This will lead us into taking a closer look into several different areas with cost of raw materials sitting idle, cost of finished goods sitting idle, the production process to the start of the order to the finished product. We will also determine the areas of flexibility to fill orders, technology (machinery), capacity/facilities, and the most important process of all, how service to the customer is being provided. I hope that KU Consulting is able to give Albatross Anchor some great ideas that will make this a larger, competitive, and profitable business and look forward to assisting you with this process in getting you to that level. Question One Based on the information presented in the scenario/case study discuss...
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...ratio is the ratio of the total contribution margin to total sales revenue. It can be used in a variety of ways. For example, the change in total contribution margin from a given change in total sales revenue can be estimated by multiplying the change in total sales revenue by the CM ratio. If fixed costs do not change, then a dollar increase in contribution margin will result in a dollar increase in net operating income. The CM ratio can also be used in break-even analysis. Therefore, knowledge of a product’s CM ratio is extremely helpful in forecasting contribution margin and net operating income. 6-2 Incremental analysis focuses on the changes in revenues and costs that will result from a particular action. 6-3 All other things equal, Company B, with its higher fixed costs and lower variable costs, will have a higher contribution margin ratio than Company A. Therefore, it will tend to realize a larger increase in contribution margin and in profits when sales increase. 6-4 Operating leverage measures the impact on net operating income of a given percentage change in sales. The degree of operating leverage at a given level of sales is computed by dividing the contribution margin at that level of sales by the net operating income at that level of sales. 6-5 The break-even point is the level of sales at which profits are zero. It can also be defined as the point where total revenue equals total cost or as the point where total contribution margin equals total fixed cost. 6-6 Three...
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