Question
In: Accounting
Sheldon industries Industries manufactures plastic bottles for the food industry. On average pays $ 73 per...
Sheldon industries Industries manufactures plastic bottles for the food industry. On average pays
$ 73
per ton for its plastics.
Sheldon'sSheldon's
waste-disposal company has increased its waste disposal-charge to
$ 50$50
per ton for solid and inert waste.
SheldonSheldon
generates a total of
500
tons of waste per month.
Sheldon'sSheldon's
managers have been evaluating the production processes for areas to cut waste. In the process of making plastic bottles, a certain amount of machine "drool" occurs. Machine drool is the excess plastic that "drips" off the machine between molds. In the past,
Sheldon
has discarded the machine drool. In an average month,
170
tons of machine drool is generated. Management has arrived at three possible courses of action for the machine drool issue:
LOADING...
(Click the icon to view the courses of action.)Read the requirements
LOADING...
.
Requirement 1. What is the annual cost of the machine drool currently? Include both the original plastic cost and the waste-disposal cost.
|
Annual cost |
|
|
Material cost of machine drool (plastic) |
|
|
Disposal cost |
|
|
Total annual cost |
Enter any number in the edit fields and then click Check Answer.
|
Clear All |
Check Answer |
More Info
|
1. |
Do nothing and pay the increased waste-disposal charge. |
|
2. |
Sell
the machine drool waste to a local recycler for
$10 per ton. |
|
3. |
Re-engineer the production process at an annual cost of
$40,000. This change in the production process would cause the amount of machine drool generated to be reduced by40% each month. The remaining machine drool would then be sold to a local recycler for$10 per ton. |
Requirements
|
1. |
What is the annual cost of the machine drool currently? Include both the original plastic cost and the waste-disposal cost. |
|
2. |
How much would the company save per year (net) if the machine drool were to be sold to the local recycler? |
|
3. |
How much would the company save per year (net) if the production process were to be re-engineered? |
|
4. |
What do you think the company should do? Explain your rationale. |
Solutions
ekkarill92 answered 1 year agoRelated Solutions
Seldon Industries manufactures plastic bottles for the food industry. On average, SheldonSheldon pays $ 73$73 per...
Seldon Industries manufactures plastic bottles for the food
industry. On average,
SheldonSheldon
pays
$ 73$73
per ton for its plastics.
Sheldon'sSheldon's
waste-disposal company has increased its waste disposal-charge
to
$ 50$50
per ton for solid and inert waste.
SheldonSheldon
generates a total of
500500
tons of waste per month.
Sheldon'sSheldon's
managers have been evaluating the production processes for areas
to cut waste. In the process of making plastic bottles, a certain
amount of machine "drool" occurs. Machine drool is the...
Salisbury Bottle Company manufactures plastic two-liter bottles for the beverage industry. The cost standards per 100...
Salisbury Bottle Company manufactures plastic two-liter bottles
for the beverage industry. The cost standards per 100 two-liter
bottles are as follows:
Cost Category
Standard Cost
per 100 Two-Liter
Bottles
Direct labor
$1.20
Direct materials
6.50
Factory overhead
1.80
Total
$9.50
At the beginning of March, Salisbury’s management planned to
produce 500,000 bottles. The actual number of bottles produced for
March was 525,000 bottles. The actual costs for March of the
current year were as follows:
Cost Category
Actual Cost for...
Wellsley Containers currently uses a recycled plastic to make bottles for the food industry. Current bottle...
Wellsley Containers currently uses a recycled plastic to make
bottles for the food industry.
Current bottle production? information:
The cost and time standards per batch of 10,000 bottles are as
?follows:
Plastic 360 kilograms at $11.00 per kg
Direct labor 6.0 hours at $20.00 per hour
The variable manufacturing overhead rate is based on total
estimated variable manufacturing overhead of $500,000 and estiamted
total DLH of 10,000. Wellsley allocates its variable manufacturing
overhead based on direct labor hours (DLH).
Proposed...
Genie in a Bottle Company (GBC) manufactures plastic two-liter bottles for the beverage industry. The cost...
Genie in a Bottle Company (GBC) manufactures plastic two-liter
bottles for the beverage industry. The cost standards per 100
two-liter bottles are as follows: Cost Category Standard Cost per
100 Two-Liter Bottles Direct labor $1.48 Direct materials 4.92
Factory overhead 0.28 Total $6.68 At the beginning of July, GBC
management planned to produce 590,000 bottles. The actual number of
bottles produced for July was 637,200 bottles. The actual costs for
July of the current year were as follows: Cost Category...
Genie in a Bottle Company (GBC) manufactures plastic two-liter bottles for the beverage industry. The cost...
Genie in a Bottle Company (GBC) manufactures plastic two-liter
bottles for the beverage industry. The cost standards per 100
two-liter bottles are as follows:
Cost Category
Standard Cost
per 100 Two-Liter
Bottles
Direct labor
$1.32
Direct materials
6.26
Factory overhead
0.32
Total
$7.9
At the beginning of July, GBC management planned to produce
430,000 bottles. The actual number of bottles produced for July was
464,400 bottles. The actual costs for July of the current year were
as follows:
Cost Category...
Genie in a Bottle Company (GBC) manufactures plastic two-liter bottles for the beverage industry. The cost...
Genie in a Bottle Company (GBC) manufactures plastic two-liter
bottles for the beverage industry. The cost standards per 100
two-liter bottles are as follows:
Cost Category
Standard Cost
per 100 Two-Liter
Bottles
Direct labor
$1.52
Direct materials
6.18
Factory overhead
0.34
Total
$8.04
At the beginning of July, GBC management planned to produce
670,000 bottles. The actual number of bottles produced for July was
723,600 bottles. The actual costs for July of the current year were
as follows:
Cost Category...
CHAP 22 Genie in a Bottle Company (GBC) manufactures plastic two-liter bottles for the beverage industry....
CHAP 22
Genie in a Bottle Company (GBC) manufactures plastic two-liter
bottles for the beverage industry. The cost standards per 100
two-liter bottles are as follows:
Cost Category
Standard Cost per 100 Two-Liter
Bottles
Direct labor
$4.00
Direct materials
9.10
Factory overhead
0.55
Total
$13.65
At the beginning of July, GBC management planned to produce
380,000 bottles. The actual number of bottles produced for July was
385,000 bottles. The actual costs for July of the current year were
as follows:...
A company manufactures various-sized plastic bottles for its medicinal product. The manufacturing cost for small bottles...
A company manufactures various-sized plastic bottles for its
medicinal product. The manufacturing cost for small bottles is $75
per unit (100 bottles), inluding fixed costs of $28 per unit. A
proposal is offered to purchase small bottles from an outside
source for $40 per unit, plus $4 per unit for freight. Prepare a
differential analysis dated July 31 to determine whether the
company should make (Alternative 1) or buy (Alternative 2) the
bottles, assuming fixed costs are unaffected by the...
Maloney Corporation manufactures plastic water bottles. It plans to grow by producing high-quality water bottles at...
Maloney Corporation manufactures plastic water bottles. It plans
to grow by producing high-quality water bottles at a low cost that
are delivered in a timely manner. There are a number of other
manufacturers who produce similar water bottles. Maloney believes
that continuously improving its manufacturing processes and having
satisfied employees are critical to implementing its
strategy.
Required:
a. Is Maloney's strategy one of product
differentiation or cost leadership? Explain briefly.
Identify at least one key element that you would expect to...
Synchromatic Industries manufactures tiles for sale in the home renovation industry. It uses the weighted-average method...
Synchromatic Industries manufactures tiles for sale in the home
renovation industry. It uses the weighted-average method for its
two divisions. Division A performs the first process in the
production process and Division B performs the second. Following is
information for Division B for the month of September:
Physical Units
WIP, Sep 1
2,600 (30% complete)
Transferred from Division A
12,000 units
WIP, Sep 30
3,000 (10% complete)
Sep 1, WIP
Costs added in September
Total
Transferred in
$25,740
$120,000
$145,740...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Explain briefly the main challenges of business process integration for a small business with example ?
- A method has been engineered and an operator has been time studied. The method has produced...
- Why do you think the financial system has become more globally integrated over time? Can you think...
- Computation of deferred taxes under IFRS is slightly different from GAAP. For example, in the United...
- How has technology improved the following job training methods: Internships (3) Business games (3)...
- do you think that the company is wise to monitor employees in this matter? why or...
- The function print_mean() that you wrote in the previous lesson calculates an average value and prints...
ADVERTISEMENT