In early 20X1, Textron Inc. entered into an agreement with Scantech Ltd. for the construction of a new office building. Construction is expected to take three years to complete. The initial total estimated cost of the building was $28 million, and the price of the contract was set at $38 million. At December 31, 20X1, the total cumulative cost incurred was $18 million. Due to increasing costs of materials, the total estimated cost of the project at the end of 20X1 was $31 million. By the end of the 20X2 fiscal year, an additional $9 million of costs was incurred. At December 31, 20X2, the total estimated cost of the project remained the same as at December 31, 20X1.

What amount should Textron recognize as gross profit (the profit element) for the December 31, 20X2, fiscal year?

Flexible Budget for Selling and Administrative Expenses for a Service Company Cloud Productivity Inc. uses flexible budgets that are based on the following data: Sales commissions 14% of sales Advertising expense 18% of sales Miscellaneous administrative expense $8,000 per month plus 12% of sales Office salaries expense $28,000 per month Customer support expenses $14,000 per month plus 20% of sales Research and development expense $30,000 per month Prepare a flexible selling and administrative expenses budget for March for sales volumes of $400,000, $500,000, and $600,000. (Use Exhibit 5 as a model.) Cloud Productivity Inc. Flexible Selling and Administrative Expenses Budget For the Month Ending March 31 Total sales $400000 $500000 $600000 Variable cost: $ $ $ Total variable cost $ $ $ Fixed cost: $ $ $ Total fixed cost $ $ $ Total selling and administrative expenses $ $ $

Chapter 10 Pure Monopoly Assignment

1. What are the major characteristics of pure monopoly?

2. In the following table are demand and cost data for a pure monopolist. Complete the table by filling in the columns for total revenue, marginal revenue, and marginal cost.

Answer these three questions:

1. What output will the monopolist produce?

(b) What price will the monopolist charge?

(c) What total profit will the monopolist receive at the profit-maximizing level of output?

Cloud Productivity Inc. uses flexible budgets that are based on the following data:

Prepare a flexible selling and administrative expenses budget for March for sales volumes of $400,000, $500,000, and $600,000. (Use Exhibit 5 as a model.)

Please show work for each step.

A manufacturing firm is planning to open a new factory. There are four countries under consideration: USA, Canada, Mexico, and Panama. The table below lists the fixed costs and variable costs for each site. The product is mainly sold in the U.S. for $995 per unit.

Location                  Fixed Cost      Variable cost

USA                          $1,000,000             $210

Mexico                     $550,000                $250

Canada                      $700,000                $230

Panama                      $ 450,000               $300

a- Using cross-over analysis, find the range of production that makes each country optimal with lowest total cost.

b- Using Excel, construct total production cost linear graph for all 4 locations and verify cross-over points obtained in part (a). In your graph, use quantity values from 0 to 20,000 at increments of 500.

c- If the company forecasts that market demand will be around 17,000 per year, which country is the best choice and what is the yearly profit?

d- Construct Total cost, Total revenue, and Total profit graphs for the optimal location in part C. In your graph, use quantity values from 0 to 20,000 at increments of 500.

Shirley, a recent college​ graduate, excitedly described to her older sister the ​$1,670 ​sofa, table, and chairs she found today.​ However, when asked she could not tell her sister which interest calculation method was to be used on her​ credit-based purchase. Calculate the monthly payments and total cost for a bank loan assuming a​ one-year repayment period and 14.5 percent interest. Now assume the store uses the​ add-on method of interest calculation. Calculate the monthly payment and total cost with a​ one-year repayment period and 12.5 percent interest. Explain why the bank payment and total cost are lower even though the stated interest rate is higher. The monthly payment for a bank loan assuming​ one-year repayment period and 14.5 percent interest is ​$? The total cost for a bank loan assuming​ one-year repayment period and 14.5 percent interest is ​$? If the store uses the​ add-on method of interest​ calculation, the monthly payment with a​ one-year repayment period and 12.5 percent interest is ​$? If the store uses the​ add-on method of interest​ calculation, the total cost with a​ one-year repayment period and 12.5 percent interest is $?

5. You are preparing a project to lay fiber optic cable. The first task is to mobilize the team. You estimate this will take one week and cost $4000. The second task is to lay the cable. This will take three weeks and will cost $30,000. The total length of the cable is 15 miles. The last task, which will take one week, is to terminate and test the cable. You budget $6000 for this. At the end of the first week, you have completed mobilization, but it cost a total of $4500. At the end of the third week, you have completed five miles of cable at a total cost of $28,000 (installation only). It takes you a total of 10 weeks to complete the entire project, for a total cost of $75,000.

a. At the end of week 1: i. What is your SPI? ii. What is your CPI? iii. What is your EAC?

b. At the end of week 3: i. What is your SPI? ii. What is your CPI? iii. What is your EAC?

c. At the end of the project: i. What is your SPI? ii. What is your CPI? iii. What is your EAC?

Can someone show me how to do this on Excel?

Thanks

4. Using the popular Utility function U=E(r) - 0.5*A*Variance(r), what is the utility for an investor with risk-aversion index of 3, whose portfolio has an expected return of 7% and a standard deviation of 16%?

Report 2 decimals in your answer

6. South Park Company's stock has an expected Return of 6.56% while Quahog Company's stock has an expected return of 3.8%. What % of my wealth should I invest in Quahog Company's stock to have an expected return of 10.86%? Report you answer as a % with 2 decimals. If your answer is 3.56%, just enter/type "3.56"

5. When consumer demand for hotel rooms increases, the average selling prices for those rooms typically increase as well. In the foodservice business that has not historically been the case. Fluctuations in consumer demand (e.g., volume differences between high demand Saturday nights and lower­volume Sunday nights) in restaurants do not typically result in menu price changes. Given that both hotels and restaurants are part of the hospitality industry, how do you account for these fundamental differences in approach toward strategic pricing? As a customer, which approach do you believe sends you the better value message? Explain your position.

Tesco plc wants to expand but foresees little exponential growth in its current retail activities. The company has, therefore, decided to utilise their ability to raise funds and their cash generation ability to organically expand into the hotel industry. Tesco feels that the market is open to a new participant and that companies such as Intercontinental Hotels Group plc are not ready for a vibrant new competitor. Tesco could expand by undertaking ‘organic’ growth orcould undertake the indicated growth by acquisition. You are required to provide a critical analysis of the relative benefits of the two types of growth (i.e. ‘organic’ and acquisition) from Tesco’s point of view, with regard to the proposed expansion.