Alpha and Beta are divisions within the same company. The managers of both divisions are evaluated based on their own division’s return on investment (ROI). Assume the following information relative to the two divisions: Case 1 2 3 4 Alpha Division: Capacity in units 57,000 291,000 101,000 200,000 Number of units now being sold to outside customers 57,000 291,000 75,000 200,000 Selling price per unit to outside customers $103 $40 $62 $48 Variable costs per unit $65 $21 $39 $32 Fixed costs per unit (based on capacity) $27 $10 $20 $9 Beta Division: Number of units needed annually 10,500 65,000 20,000 60,000 Purchase price now being paid to an outside supplier $95 $36 $62* — * Before any purchase discount. Managers are free to decide if they will participate in any internal transfers. All transfer prices are negotiated. Required: 1. Refer to case 1 shown above. Alpha Division can avoid $5 per unit in commissions on any sales to Beta Division. a. What is the minimum transfer price for Alpha Division? b. What is the maximum transfer price for Beta Division? c. Will the managers agree to a transfer? No Yes 2. Refer to case 2 shown above. A study indicates that Alpha Division can avoid $6 per unit in shipping costs on any sales to Beta Division. a-1. What is the minimum transfer price for Alpha Division? a-2. What is the maximum transfer price for Beta Division? a-3. Would you expect any disagreement between the two divisional managers over what the transfer price should be? No Yes b. Assume that Alpha Division offers to sell 65,000 units to Beta Division for $35 per unit and that Beta Division refuses this price. What will be the loss in potential profits for the company as a whole? 3. Refer to case 3 shown above. Assume that Beta Division is now receiving an 6% price discount from the outside supplier. a-1. What is the minimum transfer price for Alpha Division? a-2. What is the range of transfer price the manager's of both divisions should agree? (Round your answers to 2 decimal places.) a-3. Will the managers agree to a transfer? No Yes b. Assume that Beta Division offers to purchase 20,000 units from Alpha Division at $53.28 per unit. If Alpha Division accepts this price, would you expect its ROI to increase, decrease, or remain unchanged? 4. Refer to case 4 shown above. Assume that Beta Division wants Alpha Division to provide it with 60,000 units of a different product from the one that Alpha Division is now producing. The new product would require $26 per unit in variable costs and would require that Alpha Division cut back production of its present product by 30,000 units annually. What is the lowest acceptable transfer price from Alpha Division’s perspective?
In: Accounting
Question 1 - (What is the name of the SEC regulation that requires public companies to share information with all investors at the same time? )
A) Regulation FD
B) the Investment Company Act of 1940
C) the Sarbanes-Oxley Act
D) the Investment Advisors Act of 1940
E) the Securities and Exchange Act of 1934
Question 2 - The Securities Act of 1933:
A -requires all companies to comply with IRS rules
B- requires full disclosure of information about new securities issues
C- deals with rules for operating the stock exchanges
D- controls all mutual fund offerings
E- has complete control over the commodities traded through futures contracts
Question3 - The _____ system is the first electronic-based stock market and the largest over-the-counter market.
Group of answer choices
A) AMEX
B) NASDAQ
C) AMC
D) NASA
E) NYSE
Question 4 Which of the following statements about the New York Stock Exchange (NYSE) and the American Stock Exchange (AMEX) is true?
A- Companies listed on the NYSE cannot be listed on the AMEX at the same time.
B- Most firms traded on the NYSE are smaller than those traded on the AMEX.
C- The AMEX rules are stricter than those of the NYSE.
D-Firms cannot move from one exchange to the other.
The oldest and largest organized securities exchange in the United States is the:
Group of answer choices
A- American Stock Exchange
B- Dow Jones Stock Exchange
C- National Stock Exchange
D-Chicago Board of Exchange
E- New York Stock Exchange
F- All AMEX and NYSE transactions occur on the NYSE trading floor.
Question 5 The primary activity of _____ is underwriting.
Group of answer choices
A Securities and Exchange Commission (SEC)
B the New York Stock Exchange
C The Wall Street Journal
D stockbrokers
E investment bankers
In: Economics
A study of the amount of time it takes a mechanic to rebuild the transmission for a 2005 Chevrolet Cavalier shows that the mean is 8.6 hours and the standard deviation is 2.1 hours. If 36 mechanics are randomly selected, find the probability that their mean rebuild time exceeds 8.9 hours.
please add explanation and solve
In: Statistics and Probability
In: Operations Management
In a recent year, the Better Business Bureau settled 75% of complaints they received. (Source: USA Today, March 2, 2009) You have been hired by the Bureau to investigate complaints this year involving computer stores. You plan to select a random sample of complaints to estimate the proportion of complaints the Bureau is able to settle. Assume the population proportion of complaints settled for the computer stores is the 0.75, as mentioned above. Suppose your sample size is 276. What is the probability that the sample proportion will be at least 2 percent more than the population proportion?
Based on historical data, your manager believes that 27% of the company's orders come from first-time customers. A random sample of 191 orders will be used to estimate the proportion of first-time-customers. What is the probability that the sample proportion is between 0.31 and 0.48?
According to a 2009 Reader's Digest article, people throw away
about 9% of what they buy at the grocery store. Assume this is the
true proportion and you plan to randomly survey 67 grocery shoppers
to investigate their behavior. What is the probability that the
sample proportion does not exceed 0.14?
In: Math
Builder Products, Inc. manufactures a caulking compound that goes through three processing stages prior to completion. Information on work in the first department, cooking, is given below for May:
| Production data: | |||
| Units in process, May 1: 100% complete as to materials and 80% complete as to labour and overhead | 16,600 | ||
| Units started into production during May | 126,000 | ||
| Units completed and transferred out | 116,000 | ||
| Units in process, May 31: 60% complete as to materials and 20% complete as to labour and overhead | ? | ||
| Cost data: | |||
| Work-in-process inventory, May 1: | |||
| Materials cost | $ | 2,800 | |
| Labour cost | 3,680 | ||
| Overhead cost | 7,600 | ||
| Cost added during May: | |||
| Materials cost | 192,000 | ||
| Labour cost | 36,800 | ||
| Overhead cost | 89,200 | ||
Materials are added at several stages during the cooking process, whereas labour and overhead costs are incurred uniformly. The company uses the weighted average cost method. The company combines labour and overhead into a single cost category—conversion cost.
Required:
Prepare a production report for the cooking department for May. Use
the following three steps in preparing your report:
1. Prepare a quantity schedule and a computation of equivalent units.
2. Compute the costs per equivalent unit for the month. (Round your answers to 3 decimal places.)
3. Using the data from parts (1) and (2), prepare a cost reconciliation. (Round "Cost per equivalent unit" to 3 decimal places and the rest to the nearest dollar amount.)
Note: There is difference of "$27" in both the values due to rounding and we feel a note which reads: "Due to rounding, your "Cost accounted for" may not be equal to "Cost to account for"".
4. Prepare a production report for the cooking department for May. Assuming the company uses the FIFO method. Follow parts (1) to (3). (Leave no cells blank, enter "0" wherever required. Round "Cost per equivalent unit" to 3 decimal places and the rest to the nearest dollar amount.)
Quantity Schedule and Equivalent Units
Cost per Equivalent Unit
Cost Reconciliation
Note: There is difference of "$27" in both the values due to rounding and we feel a note which reads: "Due to rounding, your "Cost accounted for" may not be equal to "Cost to account for"".
In: Accounting
Marketing and Sales have a strong relation. To get more sale you have to develop good marketing strategies. If you have a company name Shahen Express that is working online using Website Domain www.shahenexpress.com. Which Web marketing strategies will be used in this website? How you increase the sales of the company and What will be the Revenue Model? Is Revenue Transition concept will used in the website? Justify your answer with suitable examples.
In: Operations Management
3. Profit maximization using total cost and total revenue curves
Suppose Ana runs a small business that manufactures shirts. Assume that the market for shirts is a competitive market, and the market price is $20 per shirt.
The following graph shows Ana's total cost curve.
Use the blue points (circle symbol) to plot total revenue and the green points (triangle symbol) to plot profit for shirts quantities zero through seven (inclusive) that Ana produces.
Calculate Ana's marginal revenue and marginal cost for the first seven shirts she produces, and plot them on the following graph. Use the blue points (circle symbol) to plot marginal revenue and the orange points (square symbol) to plot marginal cost at each quantity.
Ana's profit is maximized when she producesshirts. When she does this, the marginal cost of the last shirt she produces is, which is (less or greater) than the price Ana receives for each shirt she sells. The marginal cost of producing an additional shirt (that is, one more shirt than would maximize her profit) is, which is (Greater or less) than the price Ana receives for each shirt she sells. Therefore, Ana's profit-maximizing quantity corresponds to the intersection of the curves. Because Ana is a price taker, this last condition can also be written as .
In: Economics
Please summarize into short sentences.
1. Marginal revenue and Marginal Cost
2. Four market
3. Production input optimization
4. Prisoners' Dilemma game
5. 1st, 2nd, 3rd Degree price discriminations
Thank you in advance.
In: Economics
17-3 17-01
Vertical Analysis of Income Statement
Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows:
|
Current Year |
Previous Year |
|||
|
Sales |
$559,000 |
$503,000 |
||
|
Cost of goods sold |
301,860 |
246,470 |
||
|
Selling expenses |
100,620 |
100,600 |
||
|
Administrative expenses |
111,800 |
95,570 |
||
|
Income tax expense |
16,770 |
25,150 |
||
a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers.
|
Innovation Quarter Inc. |
||||
|
Comparative Income Statement |
||||
|
For the Years Ended December 31 |
||||
|
Current year Amount |
Current year Percent |
Previous year Amount |
Previous year Percent |
|
|
Sales |
$559,000 |
% |
$503,000 |
% |
|
Cost of goods sold |
301,860 |
% |
246,470 |
% |
|
$ |
% |
$ |
% |
|
|
Selling expenses |
100,620 |
% |
100,600 |
% |
|
Administrative expenses |
111,800 |
% |
95,570 |
% |
|
$ |
% |
$ |
% |
|
|
% |
% |
|||
|
Income tax expense |
16,770 |
% |
25,150 |
% |
|
$ |
% |
$ |
% |
|
b. The vertical analysis indicates that the cost of goods sold as a percent of sales (INCREASED/DECREASED)
by 5 percentage points, while selling expenses (INCREASED/DECREASED)
by 2 percentage points, and administrative expenses INCREASED/DECREASED
by 1 percentage points. Thus, net income as a percent of sales (INCREASED/DECREASED)
by 2 percentage points. (INCREASED/DECREASED)
In: Accounting