CTC is an on-line retailer of prescription drugs and health supplements. Vitamin-C represents a significant percentage of its sales. Demand for Vitamin-C is 12000 bottles per year. CTC incurs a fixed order placement, transportation, and receiving cost of $150 each time an order for Vitamin-C is placed with the manufacturer. CTC incurs a holding cost of 25 percent. The price charged by the manufacturer is $4/bottle. Each time CTC places an order, the manufacturer has to process, pack, and ship the order. The manufacturer has a line packing bottles at a steady rate and does not keep any inventory. The fixed cost of filling each order is $350 for manufacturer.

1. Under the non-collaborative environment, the above supply chain uses CTC’s EOQ policy. Please evaluate CTC’s annual ordering and holding costs and Manufacturer’s annual ordering cost and holding cost under the CTC’s EOQ policy. What is the total annual ordering and holding cost for this supply chain under this non-collaborative policy?

You operate your own small building company and have decided to bid on a government contract to build a pedestrian walkway in a national park during the coming winter. The walkway is to be of standard government design and should involve no unexpected costs. Your present capacity utilization rate is moderate and allows sufficient scope to understand this contract, if you win it. You calculate your incremental costs to be $268,000 and your fully allocated costs to be $440,000. Your usual practice is to add between 60% and 80% to your incremental costs, depending on capacity utilization rate and other factors. You expect three other firms to also bid on this contract, and you have assembled the following competitor intelligence about those companies.

Show all of your calculations and processes. Describe your answers in three- to five-complete sentences.

C.) Defend your answers with discussion, making any assumptions you feel are reasonable and/or are supported by the information provided.

A local government has the following transactions during the current fiscal period.

1. The budget for the police department, ambulance service, and other ongoing activities is passed. Funding is from property taxes, transfers, and bond proceeds. All monetary outflows will be for expenses and fixed assets. A deficit is projected.

2. A bond is issued at face value to fund the construction of a new municipal building.

3. A computer is ordered for the tax department.

4. The computer is received.

5. The invoice for the computer is paid.

6. The city council agrees to transfer money from the General Fund as partial payment for a special assessments project but has not yet done so. The city will be secondarily liable for any money borrowed for this work.

7. The city council creates a motor pool to service all government vehicles. Money is transferred from the general fund to permanently finance this facility.

8. Property taxes are levied. Although officials believe that most of these taxes should be collected during the current period, a small percentage is estimated to be uncollectible.

9. The city collects grant money from the state that must be spent as a supplement to the salaries of the police force. No entry has been recorded. Appropriate payment of the supplement is viewed as an eligibility requirement.

10. A portion of the grant money in (i) is properly spent.

A. For the transactions indicate in the table below what accounts will be debited and credited for fund financial statements.

B. For the transactions indicate in the table below what accounts will be debited and credited for government-wide financial statements.

A share of stock with a beta of 0.72 now sells for $58. Investors expect the stock to pay a year-end dividend of $2. The T-bill rate is 3%, and the market risk premium is 6%.

a. Suppose investors believe the stock will sell for $60 at year-end. Calculate the opportunity cost of capital. Is the stock a good or bad buy? What will investors do? (Do not round intermediate calculations. Round your opportunity cost of capital calculation as a whole percentage rounded to 2 decimal places.)

Opportunity cost of capital: %

The stock is a (good/bad) buy and the investors will (not) invest.

b. At what price will the stock reach an “equilibrium” at which it is perceived as fairly priced today? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Stock Price:

Gunes Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 1,500 units. The costs and percentage completion of these units in beginning inventory were:

A total of 9,200 units were started and 8,100 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month:

The ending inventory was 50% complete with respect to materials and 35% complete with respect to conversion costs.

The cost per equivalent unit for materials for the month in the first processing department is closest to:

1. A company manufactures a product from a raw material, which is purchased at ` 54 per kg. The company incurs a handling cost of ` 350 plus freight of ` 400 per order. The incremental carrying cost of inventory of raw material is Re. 0.50 per kg per month. In addition, the cost of working capital finance on the investment in inventory of raw material is `8 per kg per annum. The annual production of the product is 94,500 units and 2 units are obtained from one kg of raw material. Required : (i) Calculate the economic order quantity of raw materials. (ii) Advise, how frequently should orders for procurement be placed. (iii) If the company proposes to rationalize placement of orders on quarterly basis, what percentage of discount in the price of raw materials should be negotiated ?

Domingo Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 400 units. The costs and percentage completion of these units in beginning inventory were:

   Cost Percent Complete

Materials costs $ 5,500 50%

Conversion costs $ 1,700 20%

A total of 6,800 units were started and 6,100 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month:

Cost

Materials costs $ 158,700

Conversion costs $ 120,400

The ending inventory was 85% complete with respect to materials and 75% complete with respect to conversion costs. The cost per equivalent unit for materials for the month in the first processing department is closest to:

Domingo Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 1,100 units. The costs and percentage completion of these units in beginning inventory were:

A total of 7,500 units were started and 6,800 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month:

The ending inventory was 85% complete with respect to materials and 75% complete with respect to conversion costs.

The cost per equivalent unit for materials for the month in the first processing department is closest to:

Domingo Corporation uses the weighted-average method in its process costing system. This month, the beginning inventory in the first processing department consisted of 1,700 units. The costs and percentage completion of these units in beginning inventory were:

A total of 8,100 units were started and 7,400 units were transferred to the second processing department during the month. The following costs were incurred in the first processing department during the month:

The ending inventory was 85% complete with respect to materials and 75% complete with respect to conversion costs.

The cost per equivalent unit for materials for the month in the first processing department is closest to: ?

The following accounting information pertains to Boardwalk Taffy and Beach Sweets. The only difference between the two companies is that Boardwalk Taffy uses FIFO, while Beach Sweets uses LIFO.

Required
a-1. Compute the gross margin percentage for each company.
a-2. Identify the company that appears to be charging the higher prices in relation to its cost.
b-1. For each company, compute the inventory turnover ratio and the average days to sell inventory.
b-2. Identify the company that appears to be incurring the higher financing cost.